US warns Europe of diesel export ban unless strategic reserves are tapped

The threat compounds risks for a diesel market already under pressure from Russia's export restrictions, a halt in Chinese fuel exports and Middle East disruptions linked to the Iran conflict. A US export ban would particularly affect Europe, which depends on American fuel, and would probably push diesel cracks higher along with the premium of European gasoil over crude. In contrast, a coordinated EU release of roughly 120 million barrels could provide near-term relief for middle distillate prices, though it would reduce Europe's reserves heading into winter. For crude oil, the situation underscores that refined products, not crude barrels, represent the tightest segment of the oil market, keeping Brent above $100 while product markets stay turbulent.

Earlier:

• What is red diesel and why is Trump weighing selling it to curb fuel prices?

Washington wants Europe's diesel reserves brought to market before the midterms and is prepared to threaten Europe's access to US fuel to achieve that.

Key points:

• According to three sources, the US told Germany and France to release emergency diesel stocks or face a possible US diesel export ban
• A source said the US is seeking 120 million barrels of diesel from the EU over six months
• Trump is trying to reduce record US diesel prices ahead of November's midterm elections
• The EU's energy taskforce meets on Friday; the IEA has not yet asked Germany for a stock release
• Russia's diesel export ban through end-October and China's fuel export suspension add to the pressure
• Macron plans a G7 leaders' video call on fuel prices and a coordinated reserve release

The Trump administration has cautioned Germany and France to release emergency diesel inventories or face a potential US ban on diesel exports, according to three people familiar with the discussions, as Washington intensifies pressure on Europe to help lower global fuel costs.

A source based in a European capital said the US has requested that the European Union release 120 million barrels of diesel over six months.

The warning comes as President Donald Trump considers an export ban to bring down record US diesel prices ahead of November's midterm elections. US officials have been especially frustrated with France and Germany, which they believe have not fully met earlier commitments to release emergency oil and fuel stocks.

The EU's energy taskforce, which includes the European Commission and the 27 member states, will hold a call on Friday morning to discuss the situation, a Commission spokesperson said. The Commission, Germany, France, Italy, Britain and Ireland had already held a call on Thursday about a possible release, according to two EU officials. Germany's economy ministry said the International Energy Agency had not yet asked it to release stocks, and it was unclear when the agency would next convene.

US Energy Secretary Chris Wright said he was highly confident Europe could lower prices by tapping its diesel reserves, arguing the timing was right ahead of the harvest and winter heating seasons and hinting that positive news was coming. Treasury Secretary Scott Bessent said the US had fulfilled its share of a March agreement among IEA members by releasing roughly 170 million barrels of oil, and urged allies to meet their own commitments.

For Europe, the request creates a difficult choice. Releasing stocks could lower fuel costs domestically but would leave the region with smaller buffers if the crisis worsens, should the US and Iran fail to reach a peace deal. Europe has become increasingly dependent on US fuel since banning Russian imports over the war in Ukraine and since the Iran conflict disrupted Middle East supplies.

Pressure on diesel markets has been mounting from multiple fronts. Russia extended its ban on diesel exports through the end of October after Ukrainian attacks damaged several refineries, and Chinese refiners have suspended October fuel exports to protect domestic stocks.

The outcome of Friday's EU call and whether Washington proceeds with an export ban will determine the diesel supply outlook as Europe enters winter.