France to Release 10 Million Barrels of Diesel From Strategic Reserves

France will release 10 million barrels of diesel from its strategic reserves as European fuel markets face continued pressure, Prime Minister Sebastien Lecornu announced on Wednesday.

The diesel will be made available to distributors in France through an operation expected to last three months. Lecornu said he would soon sign a decree authorizing the measure.

He said the release was expected to “mechanically lower prices at the pump” by between 12 and 18 euro cents per liter of diesel. That estimate describes the anticipated effect of the measure and has not been independently confirmed as an outcome.

Pressure on European fuel supplies

Fuel prices in Europe have remained high amid additional pressure linked to the conflict in the Middle East and disruptions to traffic through the Strait of Hormuz.

TF1 reported an average diesel price in France of 2.35 euros per liter on Tuesday, while SP95-E10 gasoline was priced at 2.14 euros per liter. The reported diesel price was also given as equivalent to 2.63 U.S. dollars per liter.

Slovak Prime Minister Robert Fico said Europe was facing severe challenges in oil and fuel supply. He warned that the European energy market could come under “huge pressure” in the fall and winter, adding that pressure on diesel supplies was particularly acute and could push prices higher.

Fico also said Europe’s refining capacity was gradually declining and that some countries that had previously exported petroleum products now needed to import large quantities. He said the United States government’s threat to ban diesel exports had added to concerns over Europe’s energy supply.

According to Fico, addressing the fuel-market problems would require more than separate actions by individual European Union member states. He expressed hope that the upcoming EU summit would identify solutions.

Electricity production also in focus

Lecornu separately called on EDF, France’s state-owned electricity utility, to maximize its production capacity. He said the move was intended to help prevent electricity prices from rising this winter.

European Commission President Ursula von der Leyen said energy prices and EU measures to respond to rising costs would be key issues at the EU summit. She made the remarks in a social media post on Wednesday.

France’s planned diesel release comes as European officials consider measures to respond to fuel and energy-market pressures affecting the region.