Oil prices fell sharply after G7 countries announced plans to release 100 million barrels of oil and diesel from strategic reserves over four months in an effort to ease supply concerns and bring down prices.
The coordinated release will be carried out through the International Energy Agency (IEA), as the group seeks to address tight fuel supplies that have pushed global energy prices higher.
International benchmark Brent crude briefly dropped below $100 per barrel before recovering to around $102, while US oil prices fell by as much as five per cent.
The move followed pressure from US President Donald Trump for the European Union to release diesel from its strategic reserves, with the threat of a US ban on diesel exports if additional supplies were not made available.
While crude oil exports from the Middle East have recovered in recent weeks to levels close to those recorded before the conflict, supplies of refined fuels, particularly diesel, remain tight.
Several refineries have reportedly been damaged during the conflict, limiting the production of diesel and other petroleum products despite the recovery in crude oil shipments.
The G7 reserve release is expected to increase the availability of oil and refined fuels in the global market and help ease concerns over further supply disruptions.
