From OilPrice: September 21:
- U.S. diesel prices have surged above $6.50 per gallon, as lost Middle Eastern and Russian fuel supplies collide with limited global refining capacity.
- Washington is debating a diesel export ban to ease domestic prices, but opponents warn it could worsen the global shortage and potentially trigger similar restrictions elsewhere.
- Europe is particularly vulnerable, having closed significant refining capacity while becoming increasingly dependent on imported crude and refined fuels from the Middle East and other regions.
U.S. diesel prices broke another record last week, topping $6.50 per gallon. In Europe, fuel prices are soaring, and shortages are looming over already struggling economies. There is simply not enough refining capacity in the world to make up for the loss of Middle Eastern and Russian barrels. And there is no quick fix.
Last week, Russia said it would extend a ban on diesel exports until the end of October, as Ukrainian drone attacks on refineries continued, despite President Donald Trump’s call on the Zelensky government to stop attacking energy infrastructure, blaming the diesel price surge solely on those attacks. The latest attack came on Sunday, targeting one of Russia’s largest refineries.
However, the loss of fuel supply from the Middle East is much larger, the Wall Street Journal reported last week, citing figures from the International Energy Agency showing the amount of diesel output lost in the Middle East was three times as high as lost Russian supply....
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