G7 weighs coordinated oil reserve release on back of price surge

Finance ministers from the Group of Seven nations have discussed a possible coordinated release of oil reserves. The discussion was held as part of an online meeting on March 9 and also involved the International Energy Agency, Kyodo News reports. The meeting came about as crude prices have surged as a result of the ongoing war involving the United States-and Israel-aligned forces and Iran.

Japan’s finance minister Satsuki Katayama said after the talks that participants had agreed to take measures to support global energy supply and consider other necessary steps. She went on to say that the IEA had urged countries to move swiftly towards a collective release of oil stockpiles.

Katayama also said that G7 energy ministers would hold further discussions in the near future to examine the details of any potential release but stopped short of giving any dates for a release.

According to the IEA, member countries currently hold more than 1.2bn barrels of public emergency oil stocks, alongside a further 600mn barrels of industry stocks held under government obligations. The United States and Japan together reportedly account for about 700mn barrels of the total public reserves. According to the report, Roland Lescure said after the talks that G7 members had not yet reached a decision on whether to release emergency reserves or not.

An IEA-coordinated release of oil reserves was last carried out in 2022 following Russia's full-scale invasion of Ukraine in a bid to help stabilise global oil markets.

Britain’s Financial Times reported ahead of the meeting that several countries, including the United States, support a joint release, adding that some US officials believe a coordinated release of between 300 and 400mn barrels, which is equivalent to about 25–30% of the 1.2bn-barrel reserve, would be appropriate.