Nonlinear reduced fluid equations are derived for studying resistive instabilities in large‐aspect‐ ratio, low‐beta toroidal plasmas. An ordering is developed in which plasma compressibility as well as the poloidal curvature are retained. The nonlinear equations can be linearized and used to reproduce the Mercier criterion in the large‐aspect‐ratio, low‐beta limit. A second set of reduced equations is derived from the Braginskii fluid equations. These equations, which are very similar to the reduced magnetohydrodynamic equations, contain diamagnetic effects as well as parallel transport associated with magnetic fluctuations. Both sets of equations conserve energy exactly.