IEA agreed to release more than 20 million barrels of diesel as prices surge

The International Energy Agency agreed to accelerate the release of its remaining oil stocks on Thursday, including more than 20 million barrels of diesel "as soon as possible." The agency's Governing Board cited continued tightness in oil markets, notably for diesel.

The board said specific plans are in place for the diesel release. It did not give a timeline. The board also encouraged members with oil production and refining capacity to boost supply of crude and refined products, particularly diesel.

The board said roughly 330 million barrels have already gone out under the March 2026 Collective Action, the agency's response to the Strait of Hormuz crisis. Members agreed to complete the remaining releases of around 100 million barrels in a timely manner consistent with national circumstances. Several members have gone beyond their March commitments, and others plan to do the same, which will push the overall figure above the original 400 million barrels.

The diesel volume equals less than one day of global diesel demand and more than five days of U.S. consumption, according to CNBC. On Oct. 2, the Group of Seven nations pledged to draw down large diesel reserves across a 20-day period, according to CNBC.

President Donald Trump said Oct. 2 that Europe had signed on to send a "massive amount" of diesel from its well-filled reserves to market.

The average retail price of diesel in the U.S. was $6.32 per gallon on Thursday, more than 70% above a year earlier, according to AAA. Diesel futures traded at $4.86 on Thursday, down more than 1%.

The release does "not solve the basic problem which is how to increase production at refineries which are damaged in the Middle East or Russia, and operating at capacity in the USA," Andy Lipow, president of Lipow Oil Associates, said, according to CNBC.

The IEA warned on Wednesday that diesel markets will stay under strain into 2027. In its October Oil Market Report, the agency said replenishment of depleted inventories is unlikely before the second half of next year. It said global diesel exports in September were 700,000 barrels a day below year-earlier levels.

The report said the easing of Russian diesel export restrictions under the deal Trump announced with Russian President Vladimir Putin is unlikely to alter the global gasoil market balance, because the constraints stem from a lack of operational Russian refinery capacity.