Oil, fuel prices slide as Europe mulls strategic reserve release
Attention has now shifted to stockpiles, especially as supply buffers have weakened
Published Fri, Oct 2, 2026 · 07:16 PM
OIL and fuel futures slid as France proposed that developed nations release strategic reserves to ease surging prices at the pump.
Brent slipped below US$100 a barrel, while European diesel slumped almost 6 per cent. France proposed that countries across the continent and member nations of the International Energy Agency (IEA) release 100 million barrels of diesel and crude.
Fuel markets have been flashing signs of distress, as diesel in particular has been roiled by both the war in the Middle East and Ukrainian attacks on Russian refineries.
The Trump administration has been pressing the European Union to release stockpiles to help avert a potential ban on diesel exports from the US, which has become the continent’s top supplier. On Thursday (Oct 1), Treasury Secretary Scott Bessent urged European partners to make additional supplies available “immediately”.
French President Emmanuel Macron spoke with his US and Canadian counterparts overnight and plans to convene a meeting of Group of Seven leaders as soon as possible to help curb rising fuel prices and a crunch in refined products worldwide.
Brent remains near the triple digits after climbing on Thursday as the US deployed an additional aircraft carrier and 10,000 more troops to the Gulf. Still, prices have remained far from their peaks during the war as transits through the vital Strait of Hormuz continue, with Wall Street analysts saying earlier this week that crude flows from the region were nearing pre-war levels.
“Broadly crude flows are recovering, but the real pressure point has shifted into diesel,” said Emily Ashford, head of energy research at Standard Chartered. “Releasing stocks can provide a critical pressure-release valve, but it only buys time and doesn’t fix the underlying supply problem.”
Oil futures have swung this week as Middle East flows improved, but uncertainties loomed as Washington and Tehran failed to make headway towards a lasting peace agreement that would fully reopen Hormuz.
Attention has now shifted to strategic stockpiles, especially as supply buffers have weakened. The US offered a tranche of up to 40 million barrels of oil from its emergency reserve on Tuesday, the final such release as part of a plan agreed with the IEA earlier in the year. Energy Secretary Chris Wright appeared to swipe at European nations for not doing the same.
“Several European member countries have released only a fraction of the crude oil and petroleum products they pledged,” Wright said. “We urge every member country to fulfil its commitments.”
Shortages in fuel markets are also bolstering crude demand as refineries try to churn out as many barrels as they can just as demand rises ahead of the Northern Hemisphere winter.
To make matters more difficult, Chinese exporters have also cancelled some oil-product cargoes slated for export in October, as Asia’s top consumer prioritises domestic supply. Moscow, meanwhile, has further extended a ban on most diesel exports through October.
In the Middle East, the recovery in oil product exports hasn’t been as robust for crude. And even as more barrels slip covertly through Hormuz, risks to shipping remain elevated, with several attacks on tankers reported just this week. On Thursday, the UK Maritime Trade Operations said it received a report of a tanker being hit by an unknown projectile while transiting the strait. The extent of the damage and any environmental impact were unclear, it said.
With energy assets across the region facing attacks in the past month, the US military sent two additional Patriot missile batteries to protect oil and natural gas facilities in Saudi Arabia and Qatar in recent weeks, Axios reported, citing unnamed US government officials and a regional source. BLOOMBERG
