Following a rare request from the United States for a coordinated move to cool global energy prices, the world's largest economies said on Thursday that they were considering releasing oil from strategic reserves.
The move reflects the United States' dissatisfaction with the Organization of Petroleum Exporting Countries (OPEC) and allies such as Russia, who have rebuffed Washington's requests to increase oil production as the global economy recovers from the pandemic.
It also comes as US President Joe Biden faces political pressure ahead of next year's midterm elections over rising gasoline prices and other costs caused by the recovery.
According to several people familiar with the requests, the Biden administration has asked major oil buyers such as India and Japan, as well as China for the first time, to consider releasing crude stocks.
A South Korean official confirmed that the US had requested that some oil reserves be released. "We are thoroughly reviewing the U.S. request, however, we do not release oil reserves because of rising oil prices. We could release oil reserves in case of supply imbalance, but not to respond to rising oil prices," the official said.
The US and its allies have previously coordinated strategic petroleum reserve releases, such as in 2011, when supplies were disrupted by war in OPEC member Libya.
However, because the current proposal includes China for the first time, it represents a historic challenge to OPEC, the cartel that has influenced oil prices for over five decades.