G7 to Release 100 Million Barrels of Oil and Diesel to Curb Prices

The Group of Seven said Friday it will release 100 million barrels of oil and fuel products in the coming weeks, starting with "substantial" amounts of diesel after the fuel hit record prices in the United States.

The G7 pledged to begin "immediately" with a "frontloaded substantial release" of diesel within the next 20 days, with the remainder flowing over four months. President Donald Trump said the diesel release would happen "immediately," announcing the move on social media.

The timing is hard to miss. Trump and his Republican Party face surging fuel prices ahead of the Nov. 3 midterm elections. An AP-NORC poll shows the president's approval ratings on the economy at a new low, as the Iran war and his trade battles have pushed up U.S. prices for oil and other goods.

The numbers explain the urgency. The national average for a gallon of diesel in the U.S. stood at $6.37 on Friday, according to AAA, after touching a record $6.52 on Sept. 22. Diesel prices have also hit records in Europe.

France holds the rotating presidency of the G7 and announced the decision in a statement following videoconference talks that French President Emmanuel Macron presided over. The G7 consists of Canada, France, Germany, Italy, Japan, the U.K. and the U.S., plus EU representation.

"This common decision and this unity should bring down prices," Macron said. "The volumes we're releasing should also add liquidity to the market and bring down prices."

The release builds on a March announcement that International Energy Agency member countries would release 426 million barrels of oil and products to stabilize the oil market. European Union countries committed about 92 million barrels of that total, a promise weighted toward refined products such as diesel.

Several forces are squeezing the diesel market. Beyond higher crude prices, Russia decided to ban exports after Ukrainian drone strikes hit its refineries. Europe does not import Russian diesel, but buyers such as Turkey and Latin American countries must now compete with Europe for available barrels. Meanwhile, refined product shipments from Persian Gulf producers have fallen due to war damage and blocked export routes.

The G7 statement also addressed a contentious option at home. Some Republicans in the U.S. had called for Trump to ban American diesel exports to push domestic prices down. The group agreed not to limit energy exports to each other. Oil market analysts warn that a U.S. export ban could lower prices in the short term but eventually backfire by reducing gasoline supplies, since diesel output cannot be lowered without cutting overall refinery production.

The diplomatic groundwork came together quickly. Trump spoke overnight with Macron about rising fuel prices and the availability of petroleum products, according to the French Embassy in the U.S. Macron then chaired the Friday videoconference of G7 leaders. A White House official, who was not authorized to speak publicly and spoke on condition of anonymity, said Trump also called in to the meeting to negotiate the release of European diesel stockpiles.

The political stakes stretch beyond fuel. Trump on Thursday began what he described as a 32-day marathon of rallies to bolster his party's chances of keeping control of the U.S. House and Senate in November. The president has grown frustrated with what he sees as a disconnect between his achievements and the public's view of his work. This week he gave himself an A-plus on the economy but said "we're doing an extremely poor job of promotion."

Gas prices in the U.S. and abroad have soared during the eight-month-long Iran war, a cost Trump has repeatedly said is worth it to make sure Iran does not obtain nuclear weapons. With diesel at record levels on both sides of the Atlantic and election day seven weeks out, the success of the frontloaded release — and its effect on pump prices before November — will serve as an early test of whether coordinated stockpile drawdowns can outpace a market squeezed by war, export bans and damaged refinery infrastructure.