Trump’s bluff is too late to save him

October 5, 2026 — 11:58am

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Donald Trump coerced G7 countries into a release of their emergency reserves of oil and diesel in an attempt to lower prices in the US ahead of the midterm elections. Will his gambit work?

It might, in the short term, with oil and diesel prices dipping after the announcement that the countries – Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States – would release up to 100 million barrels of oil and diesel over the next four months, including a “front-loaded” substantial release of diesel stocks over the next 20 days.

The announcement was in response to Trump’s threat to ban US exports of diesel.

With the European Union and the UK heavily reliant on imports from the US and the northern winter looming, that was a very direct threat to their economies and societies – even though Trump now says, “we were never going to do it”.

Trump, while toying with the idea of an export ban because record gasoline and diesel prices are hurting US consumers and farmers and adding to Republican fears of a wipeout at next month’s midterms, had been told by the US oil industry that a ban might produce short-term relief but could subsequently exacerbate the problem.

With a month to go, Republicans’ midterm prospects are ‘catastrophically bad’

Their advice was that it would lead to a rapid increase in domestic inventories that would inevitably force US refiners and oil producers to cut their production of gasoline, diesel and jet fuel.

Trump’s bluff had some impact. After dipping below $US100 a barrel in response to the G7 announcement, however, the oil price bounced back up to more than $US102 a barrel. US gasoline and diesel prices edged down, but US gasoline prices are still 40 per cent higher than they were at this time last year and diesel is more than 70 per cent higher.

The release is a palliative for the deep wounds in the world’s oil markets caused by Trump’s war in the........

© The Sydney Morning Herald