Group of Seven nations have not agreed, at least not yet, on a coordinated release of petroleum reserves, according to France’s finance minister.
Finance chiefs from the group of seven wealthy countries were meeting Monday as an escalating conflict with Iran drove oil prices above $100 a barrel.
French President Emmanuel Macron told reporters on his way to Cyprus early Monday that “the use of strategic reserves is an envisaged option” as energy costs soar, according to the Associated Press. France currently holds the G-7 presidency.
The Financial Times reported that Fatih Birol, the executive director of the International Energy Agency, would head a call with G-7 finance ministers to discuss the conflict at 8:30 a.m. Eastern time. The IEA did not respond to a request for comment from MarketWatch.
The IEA’s strategic petroleum reserves are meant to shield countries from short-term oil-price crises, with members required to ensure inventory levels equal to no less than 90 days’ worth of net imports. Those members must be “ready to collectively respond to severe supply disruptions affecting the global oil market.”
Some U.S. officials would like to see a joint release of about 25% to 30% of the overall 1.2 billion barrels held, or 300 million to 400 million barrels, one source told the Financial Times. That would mark the largest amount of oil released from reserves since the IEA’s inception.
Since the reserves were set up in 1974, there have been five such releases. The last two happened shortly after Russia’s invasion of Ukraine in February 2022. The agency said the release in April of that year was its biggest ever, with 120 million barrels made available.
The U.S. and two other G-7 members have voiced their support for the proposal, the report said.
The report helped to bring oil prices off levels that surged to near $120 a barrel on Sunday. West Texas Intermediate crude was last up 11% to just over $101 a barrelafter Iraq, Kuwait and the United Arab Emirates all announced reductions in their output of oil amid escalating tensions in the Middle East.
Brent crude futures also pared gains but were still up 11%, to $103 per barrel.
Oil prices began to spike over the weekend on news of the confirmed production cuts.
