The G7 nations have agreed to release up to 100 million barrels of emergency diesel and crude oil stockpiles to ease rising fuel prices and support household economies.
The decision was made during a video conference on October 2, led by French President Emmanuel Macron, the current G7 chair.
The drawdown will be coordinated by the International Energy Agency (IEA) and executed within four months, with a focus on diesel supplies.
Macron confirmed the release aims to lower petroleum product prices, particularly diesel, across member countries including the US, UK, Germany, Italy, Canada, and Japan.
European nations faced pressure from the White House to release emergency fuel reserves or risk a US diesel export ban.
Former President Donald Trump considered such a ban to reduce domestic fuel costs before the US midterm elections.
Macron said G7 members and partners will front-load a significant diesel release within the first 20 days and agreed to increase refinery production flexibility to maximize output.
He added, "We have all committed together to releasing these strategic reserves in the proportions I mentioned, with a focus on diesel, and we are all committed to ensuring there are no export bans, and President Trump, in particular, was very clear on this point."
The G7 leaders will also consider additional diesel releases if necessary in the coming days.
Europe produces about 70% of its diesel domestically but depends on imports for the remainder, making a US export ban a serious challenge that could further raise global diesel prices.
Diesel prices in the UK reached a record £2 per liter on forecourts, raising the cost to fill an average family car to £110, nearly £32 more than before the Iran war, said Simon Williams, head of policy at the RAC.
Williams said, "This is a pump price threshold that no one wanted to cross." Many forecourts have already been selling diesel above £2 per liter for some time.
Donald Trump welcomed the release on his Truth Social platform, stating, "Europe has just agreed to release a massive amount of their heavily stocked diesel oil.
The process will begin immediately."
However, Walt Chancellor from Macquarie Group noted that releasing reserves does not address the core energy issues in the US.
He said, "The core issue the US faces is not a diesel problem. Nor is it a refined product problem.
It may not even be a petroleum problem. It is a global energy problem."
Chancellor added, "So what is the solution then? In short, more oil through the strait of Hormuz and out of the Middle East.
Anything short of that is really just shuffling deck chairs."
The IEA had previously coordinated a historic release of 400 million barrels of emergency crude oil in March to counter price shocks following US-Israeli attacks on Iran.
This release was a third of the IEA's total government stockpiles and more than double the 182 million barrels released in 2022 after Russia's invasion of Ukraine.
Brent crude oil was trading just above $100 per barrel on October 2, compared to about $72 before the Iran war began.
