The relative decline in oil prices following the G7 decision to use emergency diesel reserves

The relative decline in oil prices following the G7 decision to use emergency diesel reserves

On Monday, oil prices fell slightly in Western markets.

The increase in crude oil exports from the Middle East and the release of G7 oil reserves led to an increase in supply and neutralized concerns about the Persian Gulf oil infrastructure amidst the US war against Iran.

Thus, the price of Brent crude futures fell by 66 cents to $101.59 a barrel, while the price of US crude fell by 95 cents to $102.90 a barrel.

These developments occurred after G7 countries agreed on Friday to release 100 million barrels of diesel and crude oil from emergency reserves and pledged to refrain from imposing energy export restrictions following pressure from US President Donald Trump. In addition, shipping data published on Monday show that this reserve release adds to the volume of crude oil exports from the Middle East; exports which, despite attacks on ships passing through the Strait of Hormuz, reached a higher level in the last four days of September than before the war.

Tim Water, a senior energy market analyst, said: "The G7 decision to use strategic reserves removes some of the immediate supply concerns from prices; in addition, the view is strengthening that the volume of Saudi exports is returning to pre-war levels, even if oil exports are still carried out at a higher cost and through less efficient routes."