G7 Releases 100 Million Barrels to Ease Oil Prices

The Group of Seven nations agreed on Friday to release up to 100 million barrels of crude oil and diesel from strategic reserves over four months. The International Energy Agency (IEA) will coordinate the operation, which aims to add physical supply as commercial and government stocks run low.

Brent crude fell roughly 3% to $99.25 a barrel earlier in the day, while U.S. benchmark WTI dropped more than 4% to $88.92. European gasoil, the diesel benchmark, declined about 4.3% to $1,386.75 per tonne. By the close, Brent settled at $102.25 and WTI at $91.11, paring some intraday losses.

“We have committed that there will be no export bans; President Trump has been very clear on this.”

IEA Executive Director Fatih Birol said prices fell about $5 after the announcement and confirmed sufficient reserves remain for further action if needed. French President Emmanuel Macron, who chaired the G7 meeting, pledged no export bans among members.

Analysts caution the relief will be short-lived. Global refinery throughput was nearly five million barrels per day lower in July than a year earlier. Diesel exports from Russia, the Middle East, and Asia were down 1.3 million barrels daily, roughly 20% of seaborne trade.

The crisis stems from Middle East conflict that has effectively blocked the Strait of Hormuz, through which about 20% of global oil consumption flows. Tanker companies have rerouted vessels, creating a physical supply crunch. Washington pressed allies to act before U.S. midterm elections in November as high fuel costs became a political liability.