G7 Releases 100 Million Barrels Oil, Diesel to Combat Soaring Prices
Key Points
- G7 countries agreed October 3, 2026 to release 100 million barrels of crude oil and diesel from emergency reserves over four months.
- Global diesel prices hit $6.50 per gallon on Friday, up from $5.61 one month earlier, according to the American Automobile Association.
- Oil prices jumped Thursday and settled up more than $4 per barrel after the announcement.
Hamad Hussain, a climate and commodities economist at Capital Economics, told Al Jazeera: "The emergency release by G7 members will put some downward pressure on prices, particularly global diesel prices. However, the impact would be short-lived given that this is just a temporary solution to the supply crunch."
The G7 also coordinated on refinery operations, stating: "We will coordinate maintenance schedules across G7 refineries to prevent simultaneous capacity shutdowns and temporarily increase utilization rates where feasible." Member countries were urged to refrain from imposing export restrictions on energy products among themselves.
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Three distinct factors have compressed global diesel supply. First, diesel from the Middle East is no longer reaching Europe, which historically imported significant volumes from Saudi Arabia and Kuwait. Second, Russia has ceased all diesel exports following Ukraine's attacks on Russian refineries. Third, China has stopped exporting diesel. Demand remains elevated due to the agricultural harvesting season.
The Trump administration had threatened to impose a ban on U.S. diesel exports and pressured European nations to release emergency diesel stocks before the G7 coordinated action. The U.S.-Israel war on Iran has disrupted energy exports from the Gulf, while Ukraine's strikes on Russian energy infrastructure have further constrained supplies. Whether the 100-million-barrel release stabilizes prices depends on demand patterns and whether the underlying geopolitical conflicts continue or escalate.
Related coverage: Gaza War Three Years: 1 in 10 Pre-War Population Killed or Wounded
What Happens Next
The G7 release will likely provide temporary price relief within weeks, particularly for diesel, but sustained stability hinges on supply-side changes. If geopolitical tensions persist without resolution, prices may resume climbing after the four-month release concludes. G7 officials are likely to reconvene to consider additional releases or alternative measures.
Sources: Al Jazeera and other international news outlets.
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