Europe weighs releasing diesel reserves amid U.S. pressure
European Union countries are discussing the release of 50 million barrels of diesel from emergency stocks, while Washington is pressing for a response to rising fuel prices.
European Union countries discussed a proposal on Friday to release part of their emergency diesel reserves, amid pressure from the United States for measures capable of containing rising fuel prices.
The proposal presented by France provides for European countries to release 50 million barrels of diesel. At the same time, members of the International Energy Agency could make another 50 million barrels of crude oil available, according to sources heard by Reuters.
The discussion followed pressure from the U.S. government on Germany and France to reduce their emergency stocks. On Thursday, U.S. Trade Representative Jamieson Greer said that Europe should release part of its reserves and that meetings with European Union representatives would be held to discuss supply.
There were also reports that Washington asked the European bloc to release 120 million barrels of diesel over six months. Another request mentioned in the discussions was for major European countries to release 100 million barrels within 20 days.
European governments must balance relief for prices with the preservation of reserves intended to address possible supply disruptions. The international market is already facing restrictions associated with the war in Iran, Russia’s suspension of exports after refinery damage, and the decision by Chinese refineries to strengthen domestic stocks.
The release of 50 million barrels would represent approximately 17% of the European Union’s emergency diesel and gasoil stocks and about 3% of the bloc’s annual consumption, according to Eurostat data cited in the reporting.
European countries also discussed making the release of reserves conditional on a commitment by the United States not to unilaterally impose a ban on diesel exports. The International Energy Agency, in turn, had already approved in March the coordinated release of 400 million barrels of oil from strategic reserves, of which approximately two-thirds had reportedly been made available by this week.