Global oil prices may cool as G7 considers releasing strategic reserves

An estimated 300–400 million barrels of oil could be released from the strategic reserves of member countries of the International Energy Agency (IEA), including those from the G7 group.

On March 9, Reuters cited a source from the French government stating that G7 finance ministers would discuss the possibility of releasing emergency oil reserves during a meeting held the same day. Earlier, the Financial Times reported a similar development, noting that such actions would be coordinated under the International Energy Agency (IEA).

The ministers, along with IEA Executive Director Fatih Birol, are expected to hold a conference call to assess the impact of the ongoing conflict and explore measures to ease rising oil prices. So far, three countries, including the United States, have expressed support for the proposal to release oil reserves. However, speaking aboard Air Force One on March 7, President Trump stated that the U.S. does not currently see an immediate need to tap into its Strategic Petroleum Reserve.

All 32 IEA member countries maintain strategic oil reserves as a safeguard against sharp increases in oil prices. Some U.S. officials believe that releasing 300–400 million barrels would be appropriate. This volume represents approximately 25–30% of the combined strategic reserves, which total about 1.2 billion barrels across these countries.

This move comes as global crude oil prices have surged sharply over the past week. In the first trading session of the week, Brent and WTI crude prices briefly jumped nearly 30%, approaching USD 120 per barrel, the highest level since mid-2022. The surge was driven by production cuts from several major oil-producing countries and growing investor concerns over prolonged supply disruptions as the Middle East conflict expands.

Following the announcement, oil prices cooled somewhat. Brent crude is currently trading at around USD 106 per barrel, while WTI has declined to about USD 101. Another factor contributing to the price pullback is that Saudi Aramco, the state oil giant of Saudi Arabia, has offered spot crude cargoes through a series of rare tenders.

“However, unless crude flows through the Strait of Hormuz resume soon and regional tensions ease, upward pressure on oil prices will remain significant,” said Vasu Menon, Chief Investment Officer at OCBC (Singapore).

So far, Iraq and Kuwait have reduced oil production as storage facilities have reached capacity, while Qatar has limited liquefied natural gas (LNG) output due to transportation constraints from the Middle East. Analysts also expect that the United Arab Emirates and Saudi Arabia may soon cut production if storage capacity becomes exhausted.

The Middle East conflict has disrupted energy flows through the Strait of Hormuz, a critical shipping route for the global oil market, for more than a week. Saudi Arabia—the world’s largest oil exporter—has been increasing shipments via the Red Sea, although these volumes cannot fully offset the decline caused by the blockage of Hormuz.

Retail fuel prices have risen in many countries as a result of the conflict. In the United States, gasoline prices have increased by USD 0.88–1 per liter (about +11%), while diesel prices have risen around 15%. In Laos, gasoline prices have climbed 11–15% and diesel 33%. Thailand has also recorded gasoline price increases of 4–8%, with diesel up about 14%.

According to 24hmoney

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