The Group of Seven has agreed to release 100 million barrels of diesel and crude reserves after weeks of pressure from President Trump, who threatened a US export ban if Europe did not act. The coordinated release begins immediately and runs over four months, with diesel prioritized in the first 20 days.
G7 countries agreed on Friday to release 100 million barrels of diesel and crude oil from their strategic reserves, bowing to pressure from President Donald Trump. The White House had pushed Europe to unlock at least 100 million barrels and threatened a ban on US diesel exports if it failed to act, according to two diplomats cited by the Financial Times.
Release coordinated through the IEA
The leaders said the release, coordinated through the International Energy Agency, will begin immediately and continue over four months. The plan includes a frontloaded, substantial diesel release within the first 20 days, though the statement did not specify how much of the total would be crude versus diesel. France, which holds the G7 presidency, had earlier proposed that Europe release 50 million barrels of diesel while IEA members unlock a further 50 million barrels of crude.
Trump welcomed the move on Truth Social, saying Europe had "agreed to release a massive amount of their heavily stocked Diesel Oil." The commitment builds on a March pledge in which Europe agreed to release 73 million barrels of refined fuels as part of a 400-million-barrel IEA stock draw tied to the Middle East conflict. The US has largely completed its share of that program, but some European countries have not, according to IEA head Fatih Birol.
Markets react as diesel prices hit records
European diesel futures fell 8% to $1,337.75 a tonne after the announcement, the lowest level since early September. Wholesale diesel in New York harbour dropped almost 5% to $4.43 a gallon. Average US diesel prices had surged to a record $6.50 a gallon late last month, according to AAA, as supply disruptions from the Iran war and Russia's invasion of Ukraine squeezed refiners. In the UK, diesel surpassed £2 a litre on Friday for the first time, according to the RAC.
Europe wary of being forced into a decision
European officials have been reluctant to release reserves while the duration of the Iran conflict remains uncertain. European Commission spokesperson Anna-Kaisa Itkonen said the bloc rejects any US export ban, calling it unhelpful to all sides. The US supplied about half of the European Union's diesel imports in August, according to the IEA, leaving the bloc exposed to a potential ban. Beijing, meanwhile, had not granted its largest refineries quotas to export fuel in October, except to Hong Kong and Macau.
EU trade chief Maros Sefcovic said he discussed diesel supplies with US Trade Representative Jamieson Greer at the G20 trade ministers meeting in Milwaukee, adding that any US move to restrict exports would hurt Europe's economic outlook.
Sources: Financial Times, CNBC
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