Member countries of the International Energy Agency (IEA) agreed to release more than 20 million barrels of diesel to the market as soon as possible in an effort to rein in surging diesel prices.
The IEA said the decision was made at a governing board meeting of its 32 member countries on the 15th.
In a statement issued shortly after the meeting, the board said it would "continue to implement the collective action agreed in March in response to the Strait of Hormuz crisis," adding that it had decided to accelerate the timeline for releasing the remaining emergency stocks, including more than 20 million barrels of diesel, since detailed release plans were already in place. The board also called on member countries with oil production and refining capacity to boost supplies of crude and refined products, particularly diesel.
The IEA had earlier announced it would release more than 400 million barrels of crude oil and petroleum products after the blockade of the Strait of Hormuz triggered an energy supply crunch amid the war involving the U.S., Israel and Iran. According to the board's tally, about 330 million barrels have been released so far, leaving roughly 100 million barrels.
Still, disappointment ran deep because the announcement included no additional volumes. Abhishek Kumar, an analyst at Sparta Commodities, told Reuters that while the move was a step in the right direction, the details fell short of market expectations, adding that the more than 20 million barrels of diesel appeared to be an acceleration of previously pledged volumes rather than new supply.
Diesel supply remains tight. Global diesel exports last month fell by 700,000 barrels per day from a year earlier, according to the IEA's monthly oil market report released the previous day. Russia and the Middle East, both at the center of the war, accounted for a combined decline of 1.3 million barrels per day.
Meanwhile, U.S. President Donald Trump, who faces pressure to tame prices ahead of midterm elections next month, said recently that he had reached an agreement with Russian President Vladimir Putin on supplies of Russian diesel in exchange for a temporary waiver of sanctions on Moscow. Russia will initially supply 300,000 tons, or about 2.25 million barrels, followed by about 3.75 million barrels in November and about 7.5 million barrels after that.
Experts said, however, that while the Russian volumes would help lower prices to some extent, they would not be enough to close the diesel shortfall unless traffic through the Strait of Hormuz returns to normal.