The G7 countries have announced their decision to release 100 million barrels of oil, with a focus on providing significant quantities of diesel, in response to the recent surge in fuel prices in the United States.
President Donald Trump took to social media to confirm that the release of diesel would commence “immediately,” aligning with the G7’s commitment to initiate a front-loaded substantial release of diesel within the next 20 days, followed by the remaining amount spread over the next four months. Trump and the Republican Party are under pressure to tackle the escalating prices, especially with the upcoming Nov. 3 midterm elections.
The president is facing declining approval ratings as the conflict with Iran and trade disputes have led to price hikes for oil and various goods in the U.S. Despite the rising costs, Trump has maintained that the situation is justified to prevent Iran from acquiring nuclear weapons, expressing optimism that prices will stabilize post-conflict, although there is no clear resolution in sight.
In Canada, the average cost of diesel stood at $2.63 per liter as of Thursday, with some cities like Vancouver experiencing even higher prices at around $2.71 per liter. These elevated prices are putting strain on transport truck drivers and farmers who heavily rely on diesel to operate their vehicles and machinery.
France, currently holding the G7 presidency, made the announcement following virtual discussions led by French President Emmanuel Macron. The G7 comprises Canada, France, Germany, Italy, Japan, the U.K., the U.S., and includes EU representation. The International Energy Agency will oversee the coordinated effort to address the surge in fuel prices.
The decision entails a joint release of 100 million barrels over four months by G7 members and partners, with an immediate front-loaded release of diesel within the first 20 days. This move follows a prior announcement in March where International Energy Agency member countries planned to release 426 million barrels of oil and products to stabilize the oil market.
Additionally, Trump had recently suggested the possibility of banning diesel exports to reduce gas prices for American consumers, a move cautioned against by experts due to potential adverse effects on the global fuel market and further escalation of prices worldwide.
Despite the release of oil reserves, the G7 statement emphasized the commitment of member countries, including the U.S., to avoid imposing restrictions on energy exports among themselves, urging all producers to refrain from actions that could worsen market tensions.
Trump engaged in discussions with Macron regarding the urgency of addressing the soaring fuel prices and ensuring the availability of petroleum products, as highlighted by the French Embassy in the U.S., before leading the virtual conference. A new AP-NORC poll revealed that a majority of U.S. adults hold Trump accountable for the price hikes, with his approval rating on economic management reaching a new low.