Can releasing more of Europe’s emergency reserves bring diesel prices down?

The EU says it is ready for collective action with the IEA on a fresh emergency release. Analysts say releasing diesel reserves could lower pump prices within days, but would offer only short-term relief.

Historically high diesel prices in the EU and growing concerns about a potential US diesel export ban have prompted calls for action in the bloc.

European Commission spokeswoman Anna-Kaisa Itkonen said on Friday that the bloc was ready to work with the International Energy Agency on the possible release of fuel reserves to bring down energy prices.

On Wednesday, the International Energy Agency confirmed that it could consider releasing more emergency oil stocks if supply disruptions worsen.

At the time of writing, the size of a potential release has not been confirmed, although France suggested releasing 50 million barrels of diesel — approximately 6.7 million tonnes — alongside 50 million barrels of crude oil from the International Energy Agency’s emergency stocks on Friday morning, according to EU diplomats.

George Shaw, senior insight analyst for distillate markets at Kpler, sees the proposed 50-million-barrel diesel release as substantial.

According to Kpler, the EU and UK imported 24.25 million barrels of diesel from outside the region in September, meaning the proposed release would amount to roughly twice that monthly volume.

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