Oil Prices Drop as G7 Releases Emergency Reserves and Middle East Exports Rise
Oil prices dropped by nearly 2% on Monday as Middle East crude exports rebounded and the Group of Seven (G7) announced plans to release 100 million barrels of crude and diesel from emergency reserves. Brent crude futures settled at $100.32 per barrel, down $1.93 or 1.89%, while US West Texas Intermediate (WTI) crude fell $1.68 or 1.84% to $89.43.
The decline came despite ongoing attacks on energy infrastructure and supply disruptions linked to the US-Iran conflict. Middle Eastern crude exports exceeded pre-war levels in recent days, easing some supply concerns, though geopolitical risks persisted. The G7’s commitment to release 100 million barrels follows a 400 million-barrel emergency release coordinated by the International Energy Agency (IEA) in March.
Uncertainty remains over how much of the new G7 pledge represents fresh supply. Saudi Aramco’s CEO, Amin Nasser, warned that global inventories could take two years to rebuild after recent emergency withdrawals. US Strategic Petroleum Reserve inventories fell to their lowest level since 1982, highlighting tight supply conditions.
Geopolitical tensions continued to support prices, with attacks on Saudi Aramco sites and clashes near the Bab el-Mandeb Strait, a critical shipping route. OPEC+ postponed a review of 2027 production quotas due to the Iran conflict’s impact on expansion projects. Additionally, Saudi Aramco slashed November crude prices for Asian buyers to six-year lows, signaling increased near-term supply availability.