G7 puts 100 million barrels on the table to avert a diesel export squeeze

British drivers saw diesel prices pass £2 a litre for the first time on Friday, just as a threatened US export ban risked making imported fuel harder to obtain. Now the G7 has agreed to release 100 million barrels of crude oil and diesel from reserves, with a large share of the diesel arriving early. According to BBC Business (direct), the coordinated move aims to curb further price increases and avert restrictions on American diesel exports.

The agreement commits G7 members and partners to begin releasing stocks immediately, spread across four months under the coordination of the International Energy Agency, or IEA. A substantial diesel release is planned within the first 20 days. The group’s members also agreed not to impose restrictions on energy exports to one another. It remains unclear which partner countries will contribute reserves or how quickly their supplies will reach the market.

Diesel becomes the pressure point

President Donald Trump had threatened to stop US diesel exports unless European countries released more of their own reserves. Such a ban would have eased pressure on American fuel prices ahead of November’s midterm elections, while raising costs elsewhere. On Friday, Trump said Europe had agreed to put a large volume of diesel onto the market immediately. Treasury Secretary Scott Bessent had argued that American farmers, truckers and businesses should not bear the burden of soaring prices.

French President Emmanuel Macron said the coordinated action would “bring down the prices of petroleum products, particularly diesel”.

The stakes extend well beyond motorists. Diesel powers much of the haulage industry and is widely used in farming, so higher fuel bills feed into the cost of essentials such as food. Demand is difficult to cut, and diesel is harder to refine than petrol. For countries that depend on imports, keeping US exports flowing therefore matters alongside the release of emergency stocks.

Britain illustrates that dependence. More than half of its diesel is imported, and the US supplies 31% of those imports. American refineries produce roughly four million to five million barrels of diesel a day, according to the US Energy Information Administration. Domestic consumption is about 3.6 million barrels daily, while exports run at 1.2 million to 1.5 million barrels a day, making the country a major supplier to overseas buyers.

Reserves offer relief, but supply remains constrained

The conflict in the Middle East has restricted the flow of both crude oil and refined diesel to global markets. Supplies from Russia and China have also been reduced. Russia imposed its own diesel export ban after Ukrainian attacks on its refineries. G7 leaders said they would maintain sanctions against Russia over its continuing war in Ukraine, leaving that policy unchanged as they address the fuel squeeze.

Brent crude, a benchmark used to price oil internationally, briefly fell below $100 a barrel before returning to around $102 by Friday evening. It had traded near $73 before the US and Israel invaded Iran. Alongside the reserve release, G7 leaders plan to coordinate refinery maintenance so that multiple plants are not shut at once, and encourage countries with available capacity to increase diesel production.

The next test is delivery: how much diesel reaches buyers in the first 20 days, which partners join the release, and how quickly their stocks become available. Those details remain important as the wider four-month programme begins.