G7 agrees emergency oil release to ease fuel prices, avoids US export ban
The Group of Seven industrialised nations has agreed to release 100 million barrels of crude oil and diesel from strategic reserves over the next four months in a coordinated effort to curb soaring fuel prices. The decision, announced on 2 October 2026, came after sustained pressure from US President Donald Trump, who had threatened to block diesel exports to Europe unless allies tapped their own emergency stocks.
The agreement includes a commitment to release a "substantial quantity" of diesel within the first 20 days, according to a statement from the French presidency of the G7. The operation will be coordinated by the International Energy Agency (IEA), with the European Commission managing the contribution from EU member states.
A joint meeting of EU ambassadors and the bloc's energy task force on 7 October concluded that diesel supply remains stable for now, though prices remain elevated.
What the deal means for fuel prices
Diesel prices in Europe have more than doubled since the outbreak of the Iran conflict in February 2026. In Italy, prices remain significantly higher than pre-crisis levels, putting pressure on households and transport operators.
The immediate market reaction was strong: European diesel futures fell sharply, while global crude benchmarks also recorded declines. Commission President Ursula von der Leyen said citizens "need and deserve energy at affordable prices" after the deal was struck.
How the release will work
The 100 million barrels include commitments already made in March 2026, when IEA members agreed to a collective release of 400 million barrels. By October, about two-thirds of that volume had already reached markets.
According to the IEA, roughly 20 per cent of global emergency stocks have been deployed, leaving 80 per cent still available. The current release represents an acceleration of deliveries already pledged, rather than an entirely new injection.
The G7 also agreed to:
• Coordinate refinery maintenance schedules to avoid simultaneous shutdowns
• Temporarily increase plant utilisation rates where possible
• Refrain from imposing export restrictions on energy among member states
Iran has traditionally supplied diesel to Europe. Since the Hormuz crisis began, the US share of EU diesel imports rose from 21 per cent in 2025 to over 50 per cent last August, making American supply critical.
Europe's new negotiating strategy
Von der Leyen announced on 6 October the creation of a task force to aggregate energy demand across the EU, giving member states greater bargaining power with suppliers. The model mirrors the AggregateEU gas-buying platform launched in 2023.
"When Russia tried to blackmail us, we brought European buyers together," she told the European Parliament plenary in Strasbourg. The new body will be coordinated by the European Commission.
She stressed that short-term support must be "targeted and directed at those who need it", warning that blanket aid would create enormous costs. Fossil fuel imports have cost Europe an extra €100 billion since the conflict in the Middle East began.
At the G7 meeting, Italian Prime Minister Giorgia Meloni proposed a "structured dialogue" with Gulf states to secure longer-term supply stability.
What happens next
The IEA will monitor implementation and present a follow-up report within 20 days. Its governing board meets on 14–15 October to finalise how volumes are split among countries.
Trump, speaking to reporters before departing for Alabama, said he had "never really considered" a diesel export ban and praised Europe's response as "exceptional".
Energy prices will dominate the European Council summit on 15–16 October, with leaders aware that a difficult winter lies ahead. Gas prices are already up 140 per cent, according to EU data, and the tightening sanctions and conflict around the Strait of Hormuz show no sign of easing.
