Key facts
- G7 nations will release up to 100 million barrels of emergency oil and diesel reserves.
- The release is coordinated by the International Energy Agency and will occur within four months.
- The move aims to lower petroleum product prices, particularly diesel.
- Donald Trump had threatened a US diesel export ban to lower domestic prices.
- The average price of diesel in the UK reached a record £2 per liter on Friday.
G7 leaders have agreed to release up to 100 million barrels of emergency diesel and crude oil reserves within four months to combat surging fuel prices. The coordinated drawdown, managed by the International Energy Agency (IEA), aims to ease pressure on petroleum product costs, particularly diesel.
French President Emmanuel Macron, current chair of the G7, confirmed the decision on Friday following a video meeting of leaders. The move comes amid pressure from US President Donald Trump, who had considered a US diesel export ban to lower domestic fuel prices ahead of the US midterm elections. Macron stated that G7 members and partners would prioritize a substantial diesel release within the first 20 days and committed to avoiding export bans.
European countries had been urged by the White House to release emergency supplies. A US export ban would have significantly challenged Europe, which relies on imports to meet its diesel demand. Analysts had warned that increased competition for diesel on the global market could further inflate prices.
The average price of diesel in the UK hit a record high of £2 per liter on Friday, with the cost to fill an average family car now at £110, according to the RAC. Some forecourts have been selling diesel above £2 per liter for some time.
Donald Trump welcomed the G7 decision on his Truth Social platform. However, Walt Chancellor, an analyst at Macquarie Group, suggested that the core issue for the US is a broader global energy problem, not specifically diesel, and that increased oil flow from the Middle East is the true solution. The IEA previously orchestrated the largest-ever release of government oil reserves in March, with 400 million barrels of crude, to address price shocks following attacks on Iran. Brent crude oil was trading just above $100 a barrel on Friday.