Oil prices dropped sharply on Friday as Europe moved closer to releasing emergency diesel and crude stocks under pressure from Washington. WTI fell nearly 4% and Brent slid back below $100 a barrel, with reports pointing to a French-led proposal for a coordinated release through the International Energy Agency.
WTI and Brent fall as reserve release gains traction
WTI dropped 3.78% to $89.36 a barrel at 6:54 a.m. ET on Friday, while Brent traded at $99.79, down 2.46%, pulling the global benchmark back under the $100 mark. CNBC later put Brent at $99.78, down 2.5%, and WTI at $89.42, down 3.7%, as the session's losses extended.
The selloff followed reports that European governments are discussing another coordinated release of emergency oil stocks as Washington pushes allies to add barrels and diesel to the market. Reuters reported separately that EU member states were discussing a French proposal to release 50 million barrels of diesel, alongside a 50 million barrel crude release by IEA members — though CNBC noted it could not independently verify the report, which cited a single unnamed source.
Washington presses Germany and France
European Energy Commissioner Dan Jørgensen said the bloc is weighing the timing of a release with IEA members. According to Euronews: "We've used it before, and we'll likely use it again", he said of the strategic reserves. The European Commission also held a call on Thursday with several countries, including non-EU member the UK, to assess scenarios.
The U.S. has urged Germany and France — which together hold about 35% of the EU's strategic diesel reserves — to release diesel from emergency stockpiles or face a potential U.S. export ban. The EU holds an estimated 39 million tons of diesel, equivalent to more than two months of the bloc's consumption.
Diesel shortage drives the pressure
Crude prices jumped back above $100 a barrel in September as crude oil and diesel markets tightened, pushing diesel prices to record highs in several countries, including the United States. The EU is holding crisis talks on Friday on a coordinated response after U.S. Treasury Secretary Scott Bessent called on European countries to speed up reserve releases.
Trump had repeatedly floated a diesel export ban but appeared to cool on the idea earlier this week following a resurgence in crude exports through the Strait of Hormuz. The U.S. supplied around half of the EU's diesel imports in August, according to the IEA, underscoring the bloc's exposure to any export restriction.
Sources: Investing.com, CNBC
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