By Reuters
BRUSSELS: Group of Seven countries agreed on Friday to release 100 million barrels of diesel and crude oil from emergency reserves and pledged to refrain from energy export restrictions after pressure from US President Donald Trump.
The US led a pressure campaign on the European Union to draw down emergency diesel inventories, with the Trump administration warning that failure to act could lead to a US ban on diesel exports. Such a ban could sharply reduce supplies to Europe, which has become increasingly reliant on US diesel, and potentially inflict high economic costs on the bloc.
Trump is seeking to cool surging fuel prices ahead of the November midterm elections.
Trump told reporters at the White House before departing for Alabama that the US would not impose a diesel export ban. He said the plan was never really on the table, even though in the past two weeks he said several times that such a ban was under consideration, and that he supported the idea.
“Europe has a lot of diesel, and they’re going to be making a major world contribution, and so are we. And we’re not going to be doing the export ban. We’re going to be doing what we’re supposed to do,” Trump said.
The Iran war sparked the biggest emergency stock release ever of 400 million barrels in March, coordinated by the International Energy Agency.
“Europe has just agreed to release a massive amount of their heavily stocked Diesel Oil. The process will begin immediately,” Trump wrote in a post on Truth Social.
“Europe has just agreed to release a massive amount of their heavily stocked Diesel Oil. The process will begin immediately,” Trump wrote in a post on Truth Social.
EU governments had discussed on Friday a proposal by France for European countries to release 50 million barrels of diesel, and for IEA members to release 50 million barrels of crude oil, three sources familiar with the discussions said.
A 50-million-barrel release of diesel would equate to approximately 17% of the EU’s total emergency stocks of diesel and gasoil, Eurostat data showed, or about 3% of the bloc’s annual consumption.
US diesel futures fell after reports of the stock-release discussions by 3.25% to $4.49 a gallon. Benchmark European diesel futures fell by roughly $83 per metric ton, down 5.75%, LSEG data showed.
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