(Bloomberg) — The Group of Seven (G7) countries and their partners are set to release up to 100 million barrels of emergency oil and diesel reserves. This move comes in response to pressure from the Trump administration to help lower rising fuel prices.
French President Emmanuel Macron, who currently chairs the G7, announced at a press briefing on Friday that the release, coordinated by the International Energy Agency (IEA), will occur over the next four months. The G7 aims to reduce fuel prices with this action.
Following this announcement, European diesel prices and Brent crude futures fell sharply.
The decision was prompted by the potential for a diesel-export ban from the US, which would have significantly affected European supply—an important concern for a continent that relies heavily on imports to fill a diesel production gap.
Earlier, the IEA had already put together a plan to release 400 million barrels in March amid the outbreak of the war in Iran, although President Trump criticized Europe for not making those barrels available quickly enough.
A recent statement from the G7 hinted that the upcoming release of 100 million barrels may include additional barrels beyond those from the March plan.
Macron said, “We have all committed to releasing these strategic reserves as I mentioned, focusing on diesel. We are united in ensuring there are no export bans, which President Trump specifically emphasized.”
In a social media post on Friday, Trump expressed his approval of the new measures, stating, “Europe has just agreed to release a massive amount of their heavily stocked Diesel Oil. The process will begin immediately.”
The price difference between diesel and crude oil, an important market indicator, fell to $69 a barrel, down from $76.77 on Thursday, according to Bloomberg data.
While the war in Iran has driven crude prices higher, it has created even more pressure on oil products like diesel and gasoline. This is due to the conflict and the ongoing war in Ukraine, which have both led to a shortage of operational refineries that can supply the market.
In the US, diesel prices have surged to a record $6.50 a gallon, impacting farmers and prompting Trump to indicate he would support an export ban. Meanwhile, in Europe, futures prices have occasionally exceeded $200 a barrel, a level that traders suggest could dampen demand.