G7 Agrees to Release 100M Barrels of Diesel and Crude Oil
The G7 countries have agreed to release up to 100 million barrels of diesel and crude oil from their strategic reserves over the next four months, in a coordinated effort to ease pressure on global energy markets. The move comes amid disruptions linked to the conflict in the Middle East, which has pushed fuel prices higher due to tight diesel supplies and disruptions to global energy flows.
The agreement marks a major intervention by the world's leading industrial economies. Under the plan, significant volumes of diesel will be released onto the market within the next 20 days. The G7 countries have also left open the possibility of discussing additional releases if market conditions require further intervention.
French President Emmanuel Macron said the decision to release reserves was a coordinated effort through the International Energy Agency (IEA). US President Donald Trump welcomed the decision, stating that Washington would not impose a ban on diesel exports. The move comes after the US urged European allies to tap their strategic diesel reserves to help alleviate supply shortages.
The G7 decision adds another layer of coordinated intervention as disruptions to global fuel supplies persist. Oil prices fell sharply following news of the agreement, with US crude prices declining by roughly 5% and Brent crude falling below $100 a barrel. The market reaction reflects expectations that additional strategic supplies could help narrow the immediate gap between global demand and available refined products.
The impact is particularly significant for diesel, which is widely used in freight transportation, agriculture, and industry. US Treasury Secretary Scott Bessent argued ahead of the G7 agreement that American farmers, truck drivers, and businesses should not bear the full burden of a global diesel shortage. The timing also adds a political dimension to the US response, with the country heading toward midterm elections in November.
The energy shock is feeding into broader inflation pressures. Eurozone inflation rose to 3.8% in September, its highest level in three years, with higher energy prices contributing significantly to the increase.