G7 ready to act on oil surge but holds off tapping reserves

By Sudip Kar-Gupta and Alexander Chituc

BRUSSELS, March 9 (Reuters) - G7 nations said on Monday they were prepared to implement "necessary measures" in response to surging global oil prices but stopped short of committing to release emergency reserves, despite crude prices briefly surpassing $119 a barrel as the U.S.-Israel war on Iran continues.

"We are not there yet," French Finance Minister Roland Lescure told reporters in Brussels, after hosting a teleconference meeting of G7 finance ministers.

"What we've agreed upon is to use any necessary tools if need be to stabilize the market, including the potential release of necessary stockpiles."

Oil prices hit their highest levels since mid‑2022 on Monday, propelled by fears of prolonged shipping disruption and reduced output from some major producers wary of the conflict escalating. However, the market reversed late in the day, with benchmarks falling below $90 a barrel, after President Donald Trump told CBS News that the war was "pretty much" complete.

A G7 official told Reuters there was "broad consensus" not to release reserves at this stage. "It was not that someone was against, it's just about timing. More analysis is needed," the official said, adding that a final decision would fall to G7 leaders.

Lescure, whose country holds the G7 presidency this year, said there were currently no supply problems in either Europe or the United States.

Western economies coordinate their strategic oil stockpiles through the Paris-based International Energy Agency, which was formed after the 1970s oil crisis.

"We stand ready to take necessary measures, including to support global supply of energy such as stockpile release," the G7 finance ministers said in a joint statement.

European Economic Commissioner Valdis Dombrovskis said G7 finance ministers did not discuss specific market conditions that would be needed to trigger the release of strategic oil reserves, focusing only on the shared will to tap stockpiles if necessary.

Dombrovskis said more discussions among G7 energy ministers about a response to the oil price surge would take place on Tuesday.

German Chancellor Friedrich Merz, Italian Prime Minister Giorgia Meloni and Belgian Prime Minister Bart De Wever have invited a group of European leaders to discuss competitiveness, including the issue of energy prices, in a videoconference on Tuesday.

BIGGEST COLLECTIVE IEA RELEASE WAS IN 2022

IEA director Fatih Birol pushed for a release of reserves, said Japanese Finance Minister Satsuki Katayama. That country holds one of the world's largest oil stockpiles.

IEA member countries that are net oil importers are required to keep at least 90 days' worth of oil imports in stock.

The IEA coordinated the largest collective release in its history in 2022 when members freed more than 180 million barrels of oil after Russia's invasion of Ukraine.

IEA members hold more than 1.2 billion barrels of public emergency oil stocks and a further 600 million barrels of industry stocks are held under government obligation.