Diesel Prices Set for Record Highs as Global Supplies Remain Tight

Global diesel supplies will remain tight through winter due to limited refining capacity and disruptions in Russia's exports, industry executives warn. A shortage of two million barrels a day from Russia and nearly two million barrels a day from the Middle East has pushed diesel margins to record levels in Europe and the US.

Vitol CEO Russell Hardy told the APPEC conference that crude is in a better supply position than products, with the Middle East exporting nine million bpd of crude but only one million bpd of products. However, he noted that refining capacity is still insufficient to prevent product draws, leaving stockpiles at critically low levels.

Phillips 66's Mark Senn also confirmed that most US refineries are already running flat out, setting the stage for diesel prices to remain high through winter. Hardy predicted that global oil demand will decrease by about 1.5 million bpd in 2026 compared to 2025 due to high prices and limited fuel supplies.