US tells France and Germany to release diesel stocks or 'face US export ban'

The Trump administration has warned Germany and France to release emergency diesel inventories to counter soaring global fuel prices or face a potential US diesel export ban, according to sources familiar with the discussions. This move comes as US President Donald Trump weighs a possible ban to reduce US fuel prices before the November midterm elections.

The escalating pressure on Europe stems from US tariffs disputes and disagreements over military spending. Releasing more stock would pose a dilemma for the EU, as it seeks to balance domestic fuel price reductions with maintaining high stocks for a possible worsening fuel crisis if Trump and Iran fail to reach a peace deal.

The European Commission, along with Germany, France, Italy, Britain, and Ireland, held a call on Thursday to discuss the potential need for releasing diesel stocks, two EU officials revealed to Reuters. The International Energy Agency (IEA), the West's energy watchdog, has not yet requested Germany to release stocks, as per Germany's economy ministry. It remains unclear when the IEA might convene next.

The US administration has expressed particular frustration with France and Germany, alleging that they have not fully complied with earlier commitments to release emergency oil and petroleum product stocks, as previously reported by Reuters. A US official stated that Europe should collaborate with the US to boost refined product supply and lower costs for consumers.

Another source claimed that the US has asked the EU to release 120 million barrels of diesel over the next six months. Europe has grown increasingly reliant on US fuel following the ban on Russian imports due to Moscow's invasion of Ukraine and the disruption of Middle Eastern supplies caused by the US-Israeli war against Iran.

US Energy Secretary Chris Wright informed reporters that the US administration anticipates announcements from Europe concerning new diesel supplies soon. He highlighted the impact of disruptions to US fuel exports from the Middle East and China, stating that these interruptions have significantly affected the global market. Meanwhile, Russia has extended its diesel export ban until the end of October, further straining the market as Ukraine damaged numerous refiners.

Chinese refiners also suspended October fuel exports to increase domestic stocks, according to sources. French President Emmanuel Macron, however, did not discuss the issue during his meeting with Trump at the UN General Assembly in New York last week. Macron is, however, set to convene a video conference with G7 leaders to address rising fuel prices and global refined product availability, including the coordination of reserves release in conjunction with the International Energy Agency.