Trump Withdraws Diesel Export Ban Threat as Europe Agrees to Release Reserves

Donald Trump has withdrawn threats of a diesel export ban following an agreement among European states to release some reserves. The US President stated that G7 partners would be releasing significant amounts of stocks after he urged them to reduce energy prices ahead of the US mid-term elections next month. French President Emmanuel Macron indicated that a call among G7 leaders had also ruled out measures to restrict the exchange of energy and petroleum products between partner countries. This development led to Brent Crude prices returning to $100 a barrel, coinciding with average diesel prices in the UK surpassing £2 per litre for the first time. The RAC reported that diesel prices reached 200.01p per litre, marking a new high. Experts had previously warned that prices could rise to £3 per litre if the US implemented restrictions on exports. Concerns have been raised that releasing reserves now may weaken Europe's ability to respond to future supply shocks, particularly with potential disruptions to Saudi output. Trump stated that the process of releasing reserves would begin immediately, while Macron noted that up to 100 million barrels would be released into markets within four months. The coordination of this release will be managed by the International Energy Agency. The US had requested the European Union to release 120 million barrels of diesel over the next six months. The meeting emphasized that there would be no restrictions on the exchange of energy and petroleum products between partner countries. Trump had previously indicated he was seriously considering restrictions on diesel exports, as the US is the largest exporter globally. The UK typically receives about a quarter of its diesel supplies from the US. Diesel prices have been affected by ongoing conflicts in the Middle East, and Europe has increasingly relied on US fuel following bans on Russian imports due to the invasion of Ukraine. The RAC's head of policy stated that the average cost of filling a family car with diesel has increased significantly since the start of the US-Iran war. UK officials have been in discussions with counterparts in Germany, France, Italy, and Ireland regarding the use of fuel stockpiles. The UK holds only 40 days' worth of diesel reserves, while other nations maintain over 200 days. IEA member countries that are net oil importers must keep at least 90 days' worth of oil imports in stock. US Energy Secretary Chris Wright indicated that announcements regarding new diesel supplies from Europe are expected soon. Treasury Secretary Scott Bessent urged European states to release diesel reserves immediately, emphasizing the need for additional supplies to address ongoing disruptions. A Whitehall source suggested that yielding to US demands could result in significant supply shortages this winter. Ed Miliband, standing in for Andy Burnham during the G7 call, stated that the agreement would help shield households and businesses from price shocks. The moves have led to Brent Crude prices returning to $100 a barrel, with many UK garages charging £2 per litre for diesel. There are concerns that Houthi actions could disrupt the Red Sea, leading to further energy shocks. Motoring organizations have called on the government to extend the current 5p cut in fuel duty beyond the end of the year. A decision on fuel duty is expected to be announced by Chancellor John Healey in his Budget speech on October 28. Burnham has acknowledged that the UK is on track for an energy crisis this winter as international market costs surge. A recent hike to Ofgem's energy price cap took effect, with warnings that household bills could increase by another £300 from January. Campaigners have urged the government to prepare support plans for households facing rising energy costs this winter. Transport Minister Keir Mather reassured the public about the UK's diverse fuel supply sources and emphasized ongoing cooperation with US counterparts to maintain diesel supply flows. He noted that while prices have risen, the government is aware of the situation and the freeze on fuel duty remains in place.