Two Governments: Economy

Britain signed up to the G7 diesel release. What can it put in?

Sun, 04 Oct 2026 00:00:00 GMT

My verdict: Mostly right. Britain was not shut out. It joined calls with EU commissioners and governments, and signed the G7's 100 million barrel release. But it holds no public oil stocks, so its share must come from companies' tanks.

What happened

Average UK diesel reached a record 200.01p a litre on 2 October, beating 199.09p in June 2022. Filling a 55-litre tank cost £110.01, up £31.70 since 28 February.

The same day, the European Commission's Energy Union Task Force met on diesel. The Commission describes it as its own officials plus EU countries, and its notice does not mention the UK. It said EU supply "remains stable for the time being".

On 1 October, energy minister Martin McCluskey joined a call with EU commissioners, City AM reported, and ministers held calls with Germany, France, Italy and Ireland. The transport minister, Keir Mather, said Britain is not facing a shortage because its supply is "inherently resilient".

Later on 2 October, G7 leaders, including the UK, agreed to release 100 million barrels through the IEA over four months. Diesel is front-loaded into the first 20 days. They also reaffirmed a commitment to avoid energy export restrictions between G7 countries. The Guardian reported a split of 50 million barrels each of diesel and crude.

What's really going on

The RAC points to the Strait of Hormuz and US threats of an export ban. Trump had been considering a wider ban to lower US fuel prices before November's midterm elections, and Washington had pressed Europe to tap its emergency stockpiles. After the G7 call, Trump said Europe had agreed to release "a massive amount" of diesel.

The constraint is what Britain holds. Each of the 32 members of the International Energy Agency, which coordinates emergency oil stocks, must keep stocks worth at least 90 days of net imports. Britain meets that by directing companies to hold minimum stocks within their commercial stocks. When the IEA agreed its largest-ever release on 11 March, 280 million of the 426 million barrels pledged were to come from governments' own stocks.

The UK's 14.0 million barrels, about 3.3% of the total, came entirely from relaxing obligations on industry, with nothing from public stocks. The US pledged 172.2 million barrels and Germany 19.5 million, all publicly held. The G7 statement does not say how much each country will release, and the UK has not published its share.

Britain's refining base has shrunk too. UK refinery production in the second quarter of 2026 was 14% lower than a year earlier, partly because Grangemouth became an import terminal. Demand for white diesel fell 5.5%.

The strongest case on each side

The case that Britain is exposed

Grangemouth now imports rather than refines, refinery output is down 14% on a year earlier, and ministers are talking to Washington about export curbs.
In March the UK pledged nothing from public stocks because it holds none. The US pledged 172.2 million barrels from public stocks, Germany 19.5 million.
The EU's task force is the Commission plus member states, and the IEA briefs it. A one-off ministerial call is weaker than a standing seat.

The case that ministers are right

Neither ministers nor the Commission report a physical shortage. Diesel is dear because of Hormuz, and a UK stockpile cannot move a world price.
Britain meets its stockholding duty by obligating companies, not keeping state tanks, and that gave 14 million barrels in March, close to France's 14.6 million.
Britain signed the G7's 100 million barrel release, and ministers held calls with EU commissioners, Germany, France, Italy and Ireland.

My verdict: mostly right

Ministers are mostly right. Nobody reports a physical shortage, and Britain was in the G7 deal that settled the immediate row, as well as the calls with EU commissioners and governments. The "shut out" story is thinner than the headlines, because the task force is an EU body and Britain left the EU.

But the no-shortage line answers the wrong question. Drivers were paying £110.01 to fill a tank on 2 October, £31.70 more than in February. When the G7 release needs barrels, Britain's answer will again be letting companies run their tanks lower.

The fuel emergency plan's published summary lists the levers but not the point at which ministers would pull them, and that silence has a cost.

What I'd do instead

The useful question is what Britain could release of its own, now and the next time allies ask, and how it would decide.

Publish when each fuel emergency lever would be used

The energy department should add to its published summary of the National Emergency Plan for Fuel the point at which it would use each lever.

How it would work: DESNZ updates its GOV.UK summary of response tools, last revised in April 2024, to give the trigger for each lever, from a stock release to rationing at the pump.
What it costs: Officials' time. The IEA already publishes each member's oil stocks every month, in days of net imports, so no new data is needed.
Who it affects: Hauliers, farmers, forecourts and local resilience forums gain a planning basis. Ministers lose some room to decide case by case.
Tried before?: Partly. The summary lists the levers and says the least invasive comes first, but gives no thresholds. In April 2026 a Conservative peer asked ministers to publish the plan itself.
The risk: Published triggers could prompt early filling-up, which itself empties forecourts. The statement would need to say plainly that supply is stable today.

Hold a small public diesel reserve under contract

The government should buy title to a modest stock of refined diesel at existing terminals, so Britain has barrels of its own for the next IEA action.

How it would work: DESNZ tenders for storage at commercial terminals and buys title to refined diesel. Release happens only under an IEA collective action or a published emergency-plan trigger.
What it costs: Unpublished. It depends on barrels held, the purchase price and terminal rates, paid from general taxation or a levy on fuel suppliers that would reach the pump.
Tried before?: Not as a public reserve. In 2014 the government backed an industry-owned central stocking entity, if companies brought it a roadmap. No sign of one was found, and the UK's March pledge came entirely from company stocks.
Why ownership: In March the US pledged 172.2 million barrels and Germany 19.5 million from state stocks. The UK's public column was empty, so it could only ease industry obligations.
Who it affects: Taxpayers or motorists pay to hold barrels that may sit for years. Terminal operators gain storage income.
The risk: A stockpile cannot move a price set at Hormuz, and ministers would face pressure to release it for pump prices rather than supply emergencies.

Ask for observer status at the EU's diesel coordination meetings

The UK should formally request to attend the Commission's Energy Union Task Force and Oil Coordination Group as an observer whenever an IEA collective action is live.

How it would work: The energy secretary asks the Commission for a standing invitation to attend the Energy Union Task Force and the Oil Coordination Group as an observer during any IEA action.
What it costs: No direct money. The EU may ask for something in return, and the UK would attend a body in which it has no vote.
Who it affects: Ministers and officials, mainly. UK fuel importers would gain earlier notice of EU stock decisions that move the prices they pay.
Tried before?: Nothing found. The Commission describes the Task Force as itself plus EU countries. The UK's contact on 1 October was a call with commissioners, City AM reported.
The risk: The Commission can refuse, and an observer with no barrels to offer may find the seat does little. It still beats reading the notice afterwards.

The trade-off

Taxpayers or fuel suppliers would pay to hold barrels that may never be needed, and published triggers risk nudging drivers to fill up early. I think both costs are smaller than facing another US export threat with nothing to release.

How we'd know it worked

If the IEA calls another collective action by the end of 2028, the UK's public-stocks column in its confirmation table should show a figure above zero. The Commission's meeting notices should also name the UK as attending.

What to watch

Whether the US formally restricts diesel exports to Europe before the midterms
The RAC's average diesel price at the end of October
The Commission's next Energy Union Task Force notice on diesel

Sources

Is Burnham right to keep the door open to rejoining the EU?

Thu, 01 Oct 2026 00:00:00 GMT

My verdict: Partly right. Burnham is right that the question cannot wait for the next scheduled review around 2031, but four unranked options and private polling add uncertainty without a plan.

What happened

On 30 September Andy Burnham told BBC Radio 4 he wanted to look at the options for Britain's relationship with the EU. He named four. These were the status quo, the customs union Osborne proposed, the single market the Lib Dems back, or going all the way to membership. He would like Britain to rejoin 'in my lifetime', though not necessarily now, and said Brexit has caused more harm than good. He will set out options at a UK-EU summit later this year, with 20 November under discussion.

The Guardian reported that No 10 aides have asked thinktanks and pollsters to test support for a rejoin pledge in the next manifesto. Some at the top of government wanted the conference speech to promise work on rejoining after the next election. It was dropped, and No 10 denies it was ever drafted.

Macron said 'Welcome back', and the EU said it is for Britain to set out its wishes.

What's really going on

The Trade and Cooperation Agreement is the Brexit trade deal. Its Article 776 requires a review every five years, so the first falls in 2026 and the next around 2031. EU officials treat it as an implementation check, and the minister Nick Thomas-Symonds said the reset had 'overtaken' it.

The numbers come from the Office for Budget Responsibility, the government's independent forecaster. Since November 2016 it has assumed UK imports and exports will end up 15% lower than if Britain had stayed in, with productivity about 4% lower after 15 years. It found the trade assumption 'broadly on track' in 2023 and 2024. In 2022 the Treasury Committee noted forecasters expected a long-term hit larger than the pandemic's.

The May 2025 summit agreed a Common Understanding on five items: food and plant standards, linked carbon markets, the EU electricity market, a youth scheme and Erasmus+. Only Erasmus+ is signed. In December 2025 both sides promised to finish the food and carbon deals before this year's summit, which was then postponed from July. The Centre for European Reform estimates the food deal would add about £3bn each to exports and imports.

One EU diplomat says that work must be finished first. Inside No 10, some fear a pledge revives Reform UK, and the party is already braced for a pensions fight.

The strongest case on each side

The case for Burnham keeping the door open

The OBR still assumes Brexit lowers trade by 15% and productivity by 4%, so a government chasing growth cannot ignore the trading relationship.
Burnham says it is not good enough to leave the question hanging; a further decade of drift on Britain's largest market is itself a cost.
Macron said 'Welcome back', the EU is open to Britain's options, and Best for Britain polling says a rejoin pledge could double Labour's seats.

The case against reopening membership now

Labour chose its own economic policies and, as Alex Burghart argues, cannot keep blaming a vote from over a decade ago for their consequences.
A rejoin promise risks reviving Nigel Farage's flagging fortunes; the Guardian was told that fear helped keep a firmer pledge out of the speech.
One EU diplomat wants the old reset finished before 'a real reset', officials call the 2026 review implementation only, and Brussels may resist re-accession.

My verdict: partly right

Burnham is right that the question cannot wait for the next scheduled review around 2031. The OBR's Brexit assumptions have survived a decade of forecasts, and no sectoral deal on the table closes the gap. A food standards agreement worth about £3bn each way is useful and small against a 15% hit to all trade.

But he has opened the question badly. Four unranked options, plus private polling for a pledge No 10 denies drafting, invite the decade of argument he says he wants to end. On sequencing the sceptics are stronger, because most of the May 2025 agreement is unfinished and an EU diplomat says it must be done before anything bigger begins.

What I'd do instead

I would make the government publish what it knows and finish what it has already signed before asking Brussels for more.

Publish a costed options paper before the November summit

The Cabinet Office should publish government analysis of all four of Burnham's options, using the OBR's trade and productivity assumptions as the baseline.

How it would work: The Cabinet Office publishes a paper before the summit. For each of the four options it gives the effect on trade and productivity, the EU rules Britain would accept and a timetable.
What it costs: Civil service time; no figure is published and I will not invent one. The political cost is larger, since publishing numbers means defending them through the manifesto debate rather than testing them privately.
Who it affects: Voters see the working before the manifesto. No 10 loses the option of a quiet decision. Reform UK and the Conservatives, whose deputy leader Alex Burghart is already attacking, get a costed document to aim at.
Tried before?: The last government costing of the options I found is from November 2018: no deal, a trade deal and a Norway-style deal against staying in. The Blair Institute has a paper; IPPR is writing one.
The risk: Analysis built on the OBR's 15% and 4% assumptions will be contested. The Commission says it is for the UK to state its wishes, so a paper that reads as a wish list invites a cool reply.

Sign the unfinished reset deals before asking for more

Sign the food standards and carbon market deals at the November summit, as already promised, set dates for the rest, and table nothing bigger until they are done.

Background: The May 2025 summit agreed five items. Erasmus+ was signed in April 2026. In December 2025 both sides promised to finish the food and carbon deals before the 2026 summit, which then slipped from July.
How it would work: The 20 November communiqué records both deals as signed and sets dates for the electricity market and youth scheme talks. The government tables no customs union, single market or membership request until those are done.
What it costs: Both deals mean following EU rules in those areas and paying towards EU costs. In return, the food deal could add about £3bn each to exports and imports, roughly 0.3% of UK trade, per the CER.
Who it affects: Food exporters and firms paying the carbon price gain first. Rejoin campaigners, including IPPR and Best for Britain, wait longer. The youth scheme tests whether a closer deal helps Reform, which No 10 is divided over.
The risk: If the summit slips again, as one food industry source warned it could, the sequence stalls and Burnham's critics get a story. Defra says some imports from outside the EU will face more checks.

The trade-off

Publishing means No 10 gives up a quiet manifesto decision and hands opponents a costed target. Sequencing means rejoin campaigners wait, possibly past 2029, with nothing firmer than four options on paper.

How we'd know it worked

If this worked, the November summit would see the food and carbon deals signed, and the government would publish its analysis of the four options. If No 10 instead announces a manifesto position without publishing its evidence, it did not.

What to watch

The UK-EU summit, under discussion for 20 November.
Whether No 10 publishes the polling and thinktank evidence it has been gathering on a rejoin pledge.
The OBR's next forecast and its Brexit assumptions.