Oil Prices Lower On G-7 Fuel Release Plan — 2nd Update

By Farhan Rafid and Kirk Maltais

Oil and diesel fuel prices fell after the Group of Seven agreed to release crude oil and fuel from their emergency stocks and not to restrict oil exports.

December Brent crude futures dropped 1.1% to $101.23 a barrel, while December West Texas Intermediate futures slid 2.3% to $90.70 a barrel. Both have been lower through the morning as Middle Eastern export figures appear to be recovering.

European gasoil futures, a benchmark for diesel prices in the region, fell more than 7%, following the announcement. In the U.S. ultra-low sulfur diesel futures fell 3.7% to $4.47 a gallon.

The G-7 major economies said Friday that they will release the 100 million barrels of crude oil and other fuels from its stocks within the next four months. In a statement, the office of French President Emmanuel Macron said a "frontloaded substantial diesel release within the first 20 days," is a part of the deal.

The announcement is believed to curb the U.S. threat of a diesel export ban, with Macron's statement adding that the G-7 countries will "take no measures to restrict the exchange of energy and petroleum products between partner countries."

The drop-off in energy futures comes a day after Brent jumped 4.4% to settle at $102.31 as Middle East supply risks remained in focus. The oil market is increasingly pricing in a risk premium from the lack of a clear diplomatic off-ramp, Priyanka Sachdeva at Phillip Nova said in a note. Markets are increasingly accounting for the possibility that supply chains remain vulnerable for longer, she said.

The Pentagon is sending a third aircraft-carrier strike group and an additional Marine expeditionary unit to the Middle East, adding around 9,000 to 10,000 troops to the region by the end of November, The Wall Street Journal reported.

Shipping risks in the Strait of Hormuz also remain elevated. U.K. Maritime Trade Operations said a tanker was struck by an unknown projectile while transiting the strait Thursday, causing a fire. The crew was reported safe, while damage and any environmental impact remained unclear. The incident was the fifth UKMTO-reported tanker strike or suspected strike in the strait since Sept. 28.

Physical markets remain tight despite the recovery in crude flows. MUFG analysts said North Sea physical prices remain elevated as global inventories decline. OPEC+'s monitoring committee, which meets Sunday, might leave production policy unchanged while security around Middle East supply flows remains uncertain, the analysts said.

Refined-product markets remain particularly constrained. Middle Eastern diesel exports are running at around 25% of preconflict levels, while Russian diesel exports have fallen to about 20% of their May level, according to The Wall Street Journal.

Write to Farhan Rafid at @farhan.rafid@wsj.com and Kirk Maltais at kirk.maltais@wsj.com

(END) Dow Jones Newswires

October 02, 2026 12:08 ET (16:08 GMT)