G7 won’t release oil reserves to offset soaring oil prices amid Iran war – National
G7 nations said on Monday they were ready to use “necessary measures” to respond to rising global oil prices but stopped short of committing to release emergency reserves, even as crude prices briefly topped $119 a barrel as the US-Israel war against Iran continued.
“We are not there yet,” French Finance Minister Roland Lescure told reporters in Brussels, after hosting a teleconference of G7 finance ministers.
A final statement following the meeting said the ministers “will continue to closely monitor the situation and developments in the energy markets and will meet as needed to share information and coordinate between the G7 and international partners.”
“We are ready to take the necessary steps, including supporting global energy supply such as asset relief,” it added.
Oil prices hit their highest levels since mid-2022 on Monday, driven by fears of prolonged shipping disruptions and reduced output from some major producers wary of escalating conflicts. However, the market retreated late, when the benchmarks fell below $90 a barrel, after President Donald Trump told CBS News that the war was “complete”.
Canadian Finance Minister François-Philippe Champagne told reporters in Ottawa that there will be “further discussions,” including with G7 energy ministers, before any action is taken.
“It’s very flexible,” he said. “I mean, what we are all assured of is that there will be enough stock, obviously, to meet the demand. As you know, there is a stock of oil in the water, as they call it, and there is a discussion about removing the choke point in the Strait of Hormuz.
“But that should reassure the markets, it should bring confidence, and it should also reassure that the G7 is united, committed to working together, monitoring, as you say, the market, monitoring oil and energy stocks, and making sure that we’re working together on our way. That was the result this morning.”
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A G7 official told Reuters there was “broad consensus” that they should not be released from the current reserves. “It’s not that someone is against you, but it’s about time. More analysis is needed,” the official said, adding that the final decision would fall to the G7 leaders.
Lescure, whose country holds the presidency of the G7 this year, said there are currently no supply problems in Europe or the United States.
Western economies coordinate their oil accumulation strategies through the Paris-based International Energy Agency (IEA), which was established after the oil crisis of the 1970s.
“We are ready to take the necessary steps, including supporting global energy supplies such as asset relief,” the G7 finance ministers said in a joint statement.
European Economic Commissioner Valdis Dombrovskis said the G7 finance ministers did not discuss the specific market conditions that will be needed to proceed with the release of strategic oil reserves, focusing only on the shared interest to obtain shares if necessary.
Dombrovskis said further talks between G7 energy ministers on the response to rising oil prices will take place on Tuesday.
German Chancellor Friedrich Merz, Italian Prime Minister Giorgio Meloni and Belgian Prime Minister Bart De Wever invited a group of European leaders to discuss competition, including the issue of electricity prices, in a video conference on Tuesday.
THE BIGGEST RELEASE WAS IN 2022
IEA Director Fatih Birol forced the release of reserves, said Japan’s Finance Minister Satsuki Katayama. That country has the largest oil reserves in the world.
IEA member countries are oil importers who are required to keep imported oil for at least 90 days in stock.
The IEA coordinated the largest collective release in its history in 2022 when members released more than 180 million barrels of oil after Russia’s invasion of Ukraine.
IEA members hold more than 1.2 billion barrels of public emergency oil stocks and another 600 million barrels of industry stocks held under government bond.
-With additional files from Global News
