The Group of 7 (G7) nations and partners have decided to release 100 million barrels of oil and diesel reserved to ease the soaring crude prices triggered by the ongoing Middle East conflict.
The leaders of the nations will release the emergency stock over the next four months in coordination with the International Energy Agency (IEA). The group has also reassured that it will refrain from any export restrictions on energy and energy products.
The release would take place in part, with a substantial release of diesel planned in the first 20 days.
The decision came after an overnight conversation between US President Donald Trump and French President Emmanuel Macron. The US administration has put pressure on the European Union to let supplies out of the emergency inventories, as failing to do so could possibly lead to a diesel export ban on Europe. The economic blockage could put Europe in a difficult position as it has come to depend largely on US diesel to meet the shortfall of diesel in the domestic market.
The US government seeks to ease soaring fuel prices in its domestic market ahead of the November midterm elections.
The IEA had already coordinated a plan in March to release 400 million barrels from strategic reserves after the outbreak of the Iran war. However, Trump has criticised European countries for what he described as a slow pace of releasing the pledged supplies.
A subsequent G7 statement indicated that the latest 100 million-barrel release could include some volumes that have not yet been made available under the March initiative.
Macron said G7 members had agreed to release strategic reserves in previously discussed proportions, with diesel receiving particular attention. He added that the countries had also committed to keeping fuel exports flowing and avoiding export restrictions.
Trump welcomed the move in a social media post on Friday, saying Europe had agreed to release a large amount of diesel from its stocks and that the process would begin immediately.
The latest intervention comes as the Iran conflict continues to put upward pressure on crude oil prices while placing an even greater strain on refined products such as diesel and gasoline.
The core members of the G7 include the major global economies of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States, with the EU participating as a “non-enumerated” member.
(With inputs from IANS)
