Oil markets turned lower as discussions over releasing emergency fuel reserves eased fears of an immediate supply squeeze, pulling Brent crude back below $100 a barrel and sending diesel prices sharply down.
Brent lost nearly 3% to trade at $99.48 a barrel, while US West Texas Intermediate fell more than 3% to $89.52. The stronger reaction came in Europe’s diesel market, where gasoil futures dropped by more than 5%.
The shift followed discussions among European Union governments over putting additional fuel stocks onto the market. A source familiar with the talks told Reuters that France proposed releasing 50 million barrels of diesel from European reserves, alongside another 50 million barrels of crude from International Energy Agency members.
The discussions followed pressure from the United States for European countries to make more diesel available as tight supplies pushed fuel prices higher.
Ole Hansen, head of commodity strategy at Saxo Bank, said expectations of additional reserves reaching the market weighed on energy prices, particularly diesel and other refined products.
“The whole energy complex trades lower, led by gasoil and ULSD, as EU countries discuss releasing fuel and crude stockpiles to ease acute market tightness and help avert a potential US diesel export ban,” Hansen said.
The latest movement also pointed to a change in where the strongest pressure was being felt.
Crude supplies from the Middle East had been recovering, while shortages in refining capacity and lower output continued to limit the availability of diesel and other petroleum products.
“This highlights that the main stress in the energy market is no longer crude availability, with Middle East flows recovering, but rather refined product supply, constrained by reduced refinery capacity and output across the Middle East and Russia,” Hansen said.
Fuel markets had moved in the opposite direction a session earlier after Chinese refiners halted petroleum product exports for October in an effort to preserve domestic stocks.
That decision had raised concerns that international buyers could face fewer available supplies.
Even with prices falling, signs of tightness remained in the physical oil market. Barclays said inventories were continuing to decline, while buyers seeking immediate cargoes were paying premiums over deliveries scheduled for later periods.
The bank consequently raised its Brent forecast for the final quarter by $20 to $115 a barrel and increased its 2026 forecast to $100.
The latest fall left Brent heading for a weekly decline of about 4.7%, with WTI down roughly 3.1%, as the prospect of governments tapping emergency reserves temporarily eased the supply concerns that had supported energy prices.
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