What happened
The G7 countries have announced plans to release 100 million barrels of oil and diesel fuel from their strategic reserves. However, this move is unlikely to lead to a decrease in diesel prices in Estonia.
According to the International Energy Agency (IEA), its member countries, including Estonia, have already released 325 million barrels of oil and petroleum products from their strategic reserves. The IEA had committed to releasing a total of 400 million barrels, with 75 million barrels still to be released.
Estonia is not participating in the latest release, having already contributed a proportional 10 percent of its reserves in March. The country currently has about 83 days' worth of fuel reserves, with diesel reserves meeting the standard of 90 days.
Industry experts, such as Alan Vaht and Tarmo Kärsna, believe that the release of reserves will not significantly impact diesel prices in Estonia. They cite extremely thin global fuel inventories, damage to refineries, and a widening gap between current and future delivery prices as factors contributing to the high prices.
Additionally, the approaching winter demand and heating season are expected to put further pressure on the market, keeping prices high until the conflict in the Strait of Hormuz is resolved.
