Energy ministers from the Group of Seven stopped short of authorizing a release of strategic oil reserves on Tuesday, instead asking the International Energy Agency to evaluate global supply conditions before any emergency action is taken.
The request comes as oil markets react sharply to the escalating conflict involving Iran, which has sent energy prices soaring and raised concerns about potential supply disruptions.
IEA Executive Director Fatih Birol confirmed the agency had convened an extraordinary meeting of its member states to assess the security of global oil supply and market stability.
Members will analyze the situation and consider whether emergency stockpiles held by IEA countries should be released to the market in order to stabilize prices.
“We have asked the IEA to elaborate scenarios for a potential oil stock release. We need to be ready to act at any moment,” said Roland Lescure, France’s finance minister, after G7 ministers held a call to discuss rising energy costs.
The G7 group includes the United States, Canada, Japan, Italy, United Kingdom, Germany and France.
Global oil prices have swung dramatically in recent days. Benchmark crude surged to nearly four-year highs on Monday before plunging about 11 percent Tuesday after U.S. President Donald Trump suggested the conflict in the Middle East could end sooner than expected.
Meanwhile, European leaders are preparing to hold talks focused on economic competitiveness and energy costs. Participants are expected to include German Chancellor Friedrich Merz, Italian Prime Minister Giorgia Meloni and Belgian Prime Minister Bart De Wever.
European governments remain particularly sensitive to energy shocks after the crisis triggered by the Russian invasion of Ukraine sent fuel prices to record highs and forced some industries to halt production.
Even before the latest Middle East tensions, energy prices in European Union markets were already significantly higher than those in the United States and China, intensifying pressure on policymakers to intervene.
European Commission President Ursula von der Leyen warned that the current crisis highlights the risks of heavy dependence on imported fossil fuels.
“For fossil fuels we are completely dependent on expensive and volatile imports, putting us at a structural disadvantage to other regions,” she said, adding that Europe’s decision to scale back nuclear energy had been a strategic mistake.
In response to the growing pressure on energy systems, the European Commission announced that the European Investment Bank will invest €75 billion over the next three years to upgrade energy infrastructure and reduce power grid bottlenecks across Europe.
EU Energy Commissioner Dan Jørgensen said the bloc is better prepared for energy disruptions today than it was in early 2022, noting that Europe has diversified its energy sources since Russia cut gas deliveries.
Before 2022, roughly 40 percent of Europe’s natural gas came from Russia. Today, the bloc’s main suppliers include Norway and the United States.