G7 countries said they would release 100 million barrels of diesel and crude from emergency stocks over four months, coordinated by the IEA, and pledged not to impose energy export bans after pressure from President Donald Trump.
Group of Seven countries agreed on Friday to release 100 million barrels of diesel and crude oil from emergency reserves and to refrain from energy-product export bans, Reuters reported from Brussels. The joint statement said that, taking into account commitments already fulfilled, members would implement a coordinated release through the International Energy Agency of 100 million barrels.
The release is to begin immediately and run for four months, with a substantial amount of diesel to be made available within 20 days by G7 members and partners, the statement said. It did not set out a full split between crude and diesel or list volumes by country. France's president, Emmanuel Macron, who is the current G7 chair, said the aim was to bring fuel prices down.
The move followed pressure from US President Donald Trump, who had threatened a ban on US diesel exports if European partners did not release stocks, according to the Financial Times. Trump later wrote that Europe had agreed to release diesel and that the process would begin immediately. Reuters noted uncertainty over how much of the new pledge overlaps with an earlier March plan for 400 million barrels, of which IEA executive director Fatih Birol said about two-thirds had already been released.
European diesel futures fell after the announcement. The Financial Times reported the benchmark down 8 percent to $1,337.75 a tonne, the lowest since the start of September, and wholesale diesel in New York Harbor down almost 5 percent to $4.43 a gallon. The supply squeeze has been tied to disruption of shipping through the Strait of Hormuz during the Iran war.
The statement left open how quickly physical barrels will reach pumps. Markets will watch the first 20-day diesel tranche and whether governments follow through on the pledge not to restrict energy exports.
People Sentiments Mixed
- Trump called the European diesel release a welcome step
- Macron said the G7 wanted to trigger a drop in fuel prices
- The statement did not specify how the 100 million barrels would be split by country or product