Washington, United States – Group of Seven finance ministers are set to discuss a joint release of oil from emergency reserves coordinated by the International Energy Agency.
The meeting comes as Middle East conflict drives global oil prices to their highest levels since mid-2022.
Okay News reports that the discussion is scheduled for Monday according to the Financial Times. Three G7 countries including the United States have expressed support for the coordinated release.
International Energy Agency Executive Director Fatih Birol will join the call to discuss the impact of the Iran war on global energy markets. The development follows weeks of escalating conflict between the United States, Israel, and Iran.
Oil prices surged more than 25% on Monday. Brent crude futures jumped 24.96 or 27% to117.65 per barrel, on track for the biggest single-day increase on record. United States West Texas Intermediate crude futures rose 25.72 or 28.3% to116.62.
West Texas Intermediate surged 31.4% to a session high of 119.48 earlier on Monday. Brent rose as much as 29% to119.50. Before Monday’s surge, Brent had already climbed 27% and West Texas Intermediate by 35.6% last week.
Iraqi oil production from main southern oilfields dropped approximately 70%. Production fell to around 1.3 million barrels per day from roughly 4.3 million barrels before the conflict disrupted maritime movements through the Strait of Hormuz.
The sharp decline stems from storage constraints and export bottlenecks. An official with Iraq’s state-run Basra Oil Company stated that crude storage has reached maximum capacity.
The Strait of Hormuz carries roughly 20% of global oil and liquefied natural gas supplies. Disruptions in tanker movements and rising security risks have slowed shipping activity significantly.
Asian buyers are especially vulnerable given their heavy reliance on Middle Eastern crude. Several international marine insurers have suspended war-risk coverage for ships operating in Gulf waters.
Vasu Menon, Managing Director for investment strategy at OCBC in Singapore, warned that upward pressure on prices will likely persist unless oil flows through the Strait of Hormuz resume soon and regional tensions ease.
Iraq and Kuwait have begun cutting oil output. This follows earlier liquefied natural gas reductions from Qatar. Analysts expect the United Arab Emirates and Saudi Arabia will also cut output soon as storage facilities reach capacity.
The appointment of Mojtaba Khamenei to succeed his father as Iran’s supreme leader has further boosted prices. The move signals that hardliners remain firmly in charge in Tehran.
Satoru Yoshida, commodity analyst with Rakuten Securities, noted that President Donald Trump’s goal of regime change in Iran has become more difficult with the new leadership.
