French Finance Minister Roland Lescure has said the Group of Seven (G7) nations are not yet ready to release emergency oil reserves despite the sharp surge in crude prices triggered by the Gulf conflict, reported Bloomberg News.

Speaking after discussions among major economies, Lescure said the bloc stands ready to act if needed to stabilise markets, but has not reached a point where coordinated action is necessary.

“We are not there yet,” Lescure said, referring to a potential joint release of strategic petroleum reserves.

The comments come as global oil markets remain on edge following the escalating conflict involving Iran, Israel and the United States, which has disrupted energy supply routes across the Gulf region.

Oil prices have surged above $100 per barrel after the conflict affected shipping through the Strait of Hormuz, one of the world’s most important oil transit routes that carries roughly 20% of global oil supply.

G7 MONITORING MARKETS

Despite the sharp rally in crude prices, Lescure said the G7 is closely monitoring developments in the energy market and is prepared to respond if the situation worsens.

Emergency oil reserves, also known as strategic petroleum reserves, are stockpiles maintained by major economies to help stabilise markets during supply disruptions.

A coordinated release of these reserves is considered an extraordinary measure and is usually used during major global energy crises.

RESERVE RELEASE DISCUSSED AMID PRICE SURGE

G7 finance ministers have been holding discussions on the possibility of releasing oil from these reserves as prices surged following the Iran war.

Such coordinated actions are typically organised through the International Energy Agency (IEA), which oversees emergency oil stockpiles held by member countries.

However, Lescure’s remarks suggest that while governments are preparing contingency plans, policymakers believe markets have not yet reached the stage where emergency reserves must be deployed.

MARKETS REMAIN VOLATILE

Oil prices have risen sharply since the conflict intensified in the Gulf, triggering volatility across global financial markets.

Prices briefly surged above $119 a barrel on Monday, the highest level since mid-2022, as some major producers reduced supplies amid fears that prolonged disruption to shipping routes could follow the US-Israeli war with Iran.

Speaking after an online meeting of G7 finance ministers, Lescure said governments currently saw no immediate supply shortages in either Europe or the United States.

“What we’ve agreed upon is to use any necessary tools if need be to stabilise the market, including the potential release of necessary stockpiles,” he told reporters in Brussels.

Western economies coordinate their strategic oil reserves through the Paris-based International Energy Agency, which was created after the 1970s oil crisis and also provides research and market data to member countries.

IEA CONSIDERS COORDINATED OIL STOCK RELEASE

IEA director Fatih Birol has urged consideration of releasing emergency reserves, according to Japanese Finance Minister Satsuki Katayama, whose country holds one of the world’s largest oil stockpiles.

IEA member countries, which are largely net oil importers, are required to maintain at least 90 days of oil import cover in strategic reserves.

The agency last coordinated its largest collective release in 2022, when more than 180 million barrels of oil were released to stabilise markets after Russia’s invasion of Ukraine.

IEA member states currently hold more than 1.2 billion barrels of public emergency oil stocks, while an additional 600 million barrels are held by industry under government obligations.

French President Emmanuel Macron also said energy ministers would discuss the situation on Tuesday on the sidelines of a nuclear summit in Paris as governments assess the impact of the Gulf conflict on global energy markets. (India Today)

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Prime Minister Narendra Modi arrived in Calgary of Canada on Tuesday, June 17, to attend the 51st G7 Summit in Kananaskis, Alberta, marking a significant moment in India-Canada ties following a phase of strained diplomatic relations after the killing of Hardeep Singh Nijjar.

After landing in Canada, PM Modi said he would be meeting various leaders at the G7 Summit and emphasise the priorities of the Global South.

In a post on X, PM Narendra Modi said, “Landed in Calgary, Canada, to take part in the G7 Summit. Will be meeting various leaders at the Summit and sharing my thoughts on important global issues. Will also be emphasising the priorities of the Global South.”

PM Modi’s visit to Canada comes after a period of friction between New Delhi and Ottawa, triggered by Canadian allegations that Indian agents were involved in the killing of NIA-designated terrorist Hardeep Singh Nijjar outside a gurdwara in Canada in 2023.

India had strongly rejected the allegations. The diplomatic standoff escalated as both countries expelled senior diplomats in a tit-for-tat response. New Delhi has consistently voiced concerns about extremism and anti-India activities on Canadian soil and urged Canadian authorities to take concrete steps to curb such elements.

Before landing in Canada, PM Narendra Modi was visiting Cyprus. Upon the conclusion of the visit, MEA Secretary (West) Tanmay Lal highlighted that this marked Prime Minister Modi’s first visit to Cyprus and the first by an Indian Prime Minister in more than 20 years.

“This landmark visit highlights the enduring friendship and trusted partnership between our two countries,” Tanmay Lal said. (Live Mint)

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Former President Ranil Wickremesinghe has criticized the recent G7 communiqué justifying Israel’s attack on Iran as self-defence, asserting the strike occurred during ongoing US-Iran negotiations and should be rejected.

Speaking at the Valdai Discussion Club roundtable in Saint Petersburg, Russia, Wickremesinghe described the current global context as the dismantling of the existing global order and the rise of a multipolar world.

Wickremesinghe said that alongside the power blocs in Asia, Africa, Eurasia and Latin America, alternative power structures are emerging in the form of non-state actors, military actors and even the multilateral organisations such as the IMF. These influential forces are responsible for shaping the global order.

Delivering his remarks at the conference, the former President stated that the Indo-Pacific was a result of the absence of a clear boundary of the Pacific. It was created with the purpose of dealing with the Taiwan crisis, an issue the Indian Ocean has no wish to get involved in, as it is accepted that Taiwan is a part of China. (Newswire)

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Group of Seven leaders (G7) on Tuesday affirmed unified support for Israel and called for a resolution to the escalating tensions in the Middle East, as Tel Aviv trades military strikes with Tehran.

“We affirm that Israel has a right to defend itself. We reiterate our support for the security of Israel,” G7 leaders said in a joint statement.

The group condemned Iran for being the “principal source of regional instability and terror,” reiterating the stance that Iran can never have a nuclear weapon.

The leaders of the world’s largest advanced economies called for a resolution to the “Iranian crisis” and a “broader de-escalation of hostilities in the Middle East, including a ceasefire in Gaza.”

U.S. President Donald Trump will not be attending the second day of the summit “because of what’s going on in the Middle East,” White House Press Secretary Karoline Leavitt said in a post on X.

The G7 economies comprise the U.S., U.K., Canada, France, Germany, Italy and Japan, and this year’s summits also invited leaders from the European Union, Australia, Brazil, Mexico, Ukraine and South Korea.

The annual gathering seeks to facilitate consensus on the most pressing global economic and geopolitical challenges and to coordinate responses. Among the key agenda this year was also Trump’s host of tariff policy that has darkened the outlook for global economic growth.

There is also the thorny issue of support for Ukraine, or Russia’s rehabilitation, with Trump indicating that he was in no rush to impose tougher sanctions on Russia, dismissing pressure from allied leaders eager to do more to push Moscow to the negotiating table.

Speaking alongside Canadian Prime Minister Mark Carney earlier Monday, Trump said the group, earlier known as G8, made a mistake when it expelled Russia in 2014.

The G7 nations’ stance contrasted with that of China which has condemned Israel’s attack on Iran while seeking to play up its role as a peacemaker in the Middle East region. Chinese Foreign Minister Wang Yi told both Israeli and Iranian leaders that China was ready to play a constructive role in de-escalating the situation. (CNBC)

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Prime Minister Narendra Modi on Sunday said he views the current situation in Ukraine as an issue of humanity and human values and not of politics or economy even as he called for respecting international law, sovereignty and territorial integrity of all nations.

In an address at a G7 Working Session in Hiroshima, PM Modi also strongly pitched for raising voice collectively against unilateral attempts to change the status quo, asserting that any tension and dispute should be resolved peacefully through dialogue.

The prime minister also referred to his talks with Ukrainian President Volodymyr Zelensky on Saturday and reiterated that India will do whatever is possible to resolve the conflict.

PM Modi’s comments came after Zelensky addressed the G7 leaders seeking global support for Ukraine’s efforts to defend itself against Russian aggression. The war in Ukraine has been the overwhelming focus of the three-day summit.

The prime minister also invoked Buddha and said there is no such problem in the modern age whose solution cannot be found in his teachings. He quoted Buddha to say that enmity is pacified by affinity and that “we should move forward together with everyone in this spirit.” “Today we heard from President Zelensky. I also met him yesterday. I do not consider the current situation as an issue of politics or economy. I believe it is an issue of humanity, an issue of human values,” the prime minister said.

“We have said from the beginning, that dialogue and diplomacy is the only way. And to solve this situation, we will try as much as possible, whatever can be done from India,” he said.

PM Modi said all countries must respect the UN Charter, international law and the sovereignty and territorial integrity of all nations and called for raising voice together against unilateral attempts to change the status quo.

The prime minister’s comments came against the backdrop of the lingering border row with China in eastern Ladakh and Russia’s invasion of Ukraine.

“It is necessary that all countries respect the UN Charter, international law and sovereignty and territorial integrity of all countries. Raise your voice together against unilateral attempts to change the status quo,” he said.

“India has always been of the opinion that any tension, any dispute should be resolved peacefully, through dialogue. And if a solution is found by law, it should be accepted. And in this spirit, India resolved its land and maritime boundary dispute with Bangladesh,” he said.

The prime minister said that in the current global situation, the maximum and the most profound effects of the food, fuel and fertilizer crisis are being felt by the developing countries.

“Global peace, stability and prosperity is a common objective of all of us. In today’s interconnected world, tension in any one region affects all countries. And, developing countries, which have limited resources, are affected the most,” he said.

“Due to the current global situation, the maximum and most profound effects of the food, fuel and fertilizer crisis are being suffered by these countries,” he added.

PM Modi said Buddha had given a solution centuries ago to war, unrest and instability that the world is facing today.

“In India, and here in Japan too, Lord Buddha has been followed for thousands of years. There is no problem in the modern age, whose solution we cannot find in the teachings of Buddha,” he said.

The group of seven (G7), comprising the US, France, the UK, Italy, Germany, Canada and Japan, represent the world’s richest democracies. Under its G7 presidency, Japan invited India and seven other countries to the summit. (NDTV)

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When leaders from the Group of Seven nations gather for a three-day summit in Hiroshima later this month, they will be joined by a unique contingent of eight other leaders for an exercise in global diplomacy.

While Prime Minister Fumio Kishida’s decision to invite these countries — including India, South Korea, Brazil and Australia — will see G7 leaders discuss pressing international issues such as climate change and food security, other goals will also be at play: namely pushing back against Russia and China.

The G7 nations have become increasingly aware of the need to step up cooperation with emerging and developing countries, to forge a united international front on issues such as Beijing’s rising assertiveness and Moscow’s ongoing invasion of Ukraine.

Efforts to tackle the latter made headlines last week, when the Financial Times reported that, as part of pre-summit negotiations, Washington suggested replacing the current sector-by-sector sanctions regime against Russia with an almost complete export ban. The proposal was reportedly deemed “not doable” by Japan and European countries.

The move points to growing frustration in the U.S. as Russia continues to import Western technology to support its war in Ukraine, due to loopholes in the current sanctions regime.

But with neither Moscow nor Kyiv expecting a decisive battlefield victory anytime soon, broader international support will be required if Russia is to be sanctioned into submission and forced to withdraw its troops.

This became clear when Moscow said in February that the Russian economy had performed much better than expected last year, contracting only by about 2%, as it benefited from higher energy export prices, increased military spending and redirected trade flows through countries that did not join the sanctions regime — mainly China, India and Turkey.

Closing loopholes

To strengthen support for Ukraine while increasing the effectiveness of sanctions on Russia, G7 leaders understand it is crucial to get as many “Global South” countries on board as possible — especially India, which currently holds the G20 presidency, and Indonesia, this year’s chair of the Association of Southeast Asian Nations.

The term Global South refers to a loose grouping of roughly 100 nations, many developing and nonaligned with any major power. These include the four other countries invited to take part at the Hiroshima summit: Indonesia, Comoros, Vietnam and the Cook Islands.

At a G7 foreign ministers’ meeting last month, the bloc pledged “intensifying” sanctions on Russia while also vowing to tighten loopholes via closer cooperation with Global South countries. This will be crucial since the G7’s total share of world gross domestic product has dropped from slightly over 50% in 1990 to just under 30% this year, according to the IMF.

Most Global South nations have not joined the West in imposing sanctions on Russia — particularly considering the damaging knock-on effects the war has had on global food and energy prices. Many have also avoided taking sides in the growing U.S.-China rivalry, seeing benefits in relationships with both and being less concerned about a U.S.-led international order.

This means that winning their support might be a tall order unless substantial incentives or highly compelling arguments are offered.

Of importance in dealing with Russia will be Brazil — South America’s largest economy — whose president, Luiz Inacio Lula da Silva, has been criticized by the West for calling for a shift away from dollar-denominated trade and accusing Washington of prolonging the war by continuing to supply weapons to Ukraine.

The summit will also focus on preventing third-party weapons from being supplied to Russia, a move seen as a warning to China and others such as Iran against closer cooperation with Moscow.

Addressing Chinese expansion

Besides weakening Moscow, a top priority for G7 leaders will be to rally support among the eight invited countries in counterbalancing China, which is increasingly perceived as posing a “strategic challenge” to the region and beyond.

Efforts to slow down China’s technological rise, deter military aggression and boost support for democratic Taiwan are expected to feature prominently at the summit.

These efforts, including redirecting supply chains via India, Vietnam or Indonesia, are likely to play a key role in discussions about trade, economic security and resilience, trade as well as foreign and security policy.

China’s expanding nuclear arsenal will also feature in talks about nuclear disarmament and nonproliferation. This comes amid a rapidly intensifying geopolitical rivalry between China and the U.S. that many fear could result in a new type of Cold War, and possibly even veer into armed conflict.

While the West accuses China of trying to undermine the rules-based international order, Beijing accuses the West of seeking to encircle China and trying to contain and suppress its development.

As relations continue to deteriorate, experts such as Bucknell University professor Zhiqun Zhu argue that the upcoming summit will offer the G7 an opportunity to pull countries out of China’s orbit.

Without a doubt, he said, “a major purpose of inviting these nations is to have them on board in a joint effort to push back against China’s growing influence.”

Zhu said that from Washington’s perspective, some of these countries, such as Brazil, are getting too close to Beijing or still rely too heavily on trade with China, which is why it is in America’s interest to drive a wedge between them and China.

Diversifying supply chains

So why were these countries selected?

No official explanation has emerged as to why these eight countries were invited and not others, though analysts have offered a few takes.

For instance, Australia and South Korea are key U.S. allies in the Asia-Pacific. Although China is their largest trading partner, they are expected to uphold the G7’s vision of a rules-based order.

India, a member of both the BRICS and “the Quad” groupings, is a major security and economic player in the Indo-Pacific, and also China’s neighbor to the West. Indonesia, meanwhile, is not only Southeast Asia’s largest economy but also the world’s largest Muslim majority country, whose actions can shape broader regional dynamics and offer a religious-inclusion perspective.

“Both India and Indonesia are democracies, so the G7 would want to have a good working relationship with them,” said Ian Chong, a professor of political science at the National University of Singapore. As chairs of the G20 and ASEAN groupings, respectively, they are also in a unique position to shape and push the Global South agenda.

Vietnam, which also borders China, is a key focus for the G7, as Southeast Asia becomes a key area for Sino-U.S. competition. Hanoi has strong economic ties with China, but it also has a complex political relationship with Beijing.

The country is becoming more attractive for G7 members as a strategic partner based on its stable governance, its willingness to push back against China and its presentation as an alternative for manufacturing and industry.

“Alongside Brazil, these countries can help alleviate the West’s supply chain concerns and assist with diversification and de-risking from any one part of the world,” Chong said, adding that except for South Korea, they provide access to different natural resources and commodities. Most also have a sizable low-cost labor force.

And as tensions with China escalate, “strengthening and diversifying supply chains is key,” said Guy Boekenstein, an Indo-Pacific adviser to the Australian Strategic Policy Institute. This is particularly important around critical minerals, rare earth elements, critical and emerging technologies and fuel and renewable energy sources, he added.

As for the small Cook Islands in the South Pacific, they were probably selected as they represent an area of contention between China on one side and the U.S., Australia, and New Zealand on the other, Chong said.

These islands, along with Comoros in the Indian Ocean, are also among the most affected by climate change, specifically sea level rise, so including them helps the G7 push their climate agenda.

An uphill battle

The challenge, however, is whether the invited countries will side with the G7 as they will want to maintain strong and productive relations with Beijing.

“Some of them have flourishing economic relations with China, such as Vietnam and the Cook Islands, even if their security partnerships are elsewhere,” said Rafiq Dossani, director of the Center for Asia Pacific Policy at the U.S.-based Rand Corp., noting that the G7 would have to provide alternatives to offset potential losses.

“Indonesia, lacking a significant security relationship with the U.S. but with a strong economic relationship with China, seems to have the most to lose,” he added.

India, meanwhile, has been pursuing a path of “strategic autonomy” and multilateralism and has close military ties with Russia.

Besides making their economies more resilient, a key aim of having various options and partnerships is to discourage Beijing from changing the status quo by force, as the region sees a rapid military build-up amid concerns over a possible Chinese invasion of Taiwan.

The big question, however, is whether such efforts will deter Beijing or prompt escalation, Chong said.

“The calibration of credible threats and assurance must be just right for deterrence to work.” (Japan Times)

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