Diesel Prices Soar Amid Global Refining Capacity Crisis

Global diesel prices have hit fresh highs due to a combination of factors related to the ongoing Middle East conflict and Ukraine war.

The disruption has not only affected crude oil supplies but also damaged refineries, leading to capacity constraints that are being felt globally.

According to French officials, the global market is missing about 10 million barrels of crude oil per day, which is a significant amount considering the global economy was consuming around 105 million barrels daily before the conflict began.

Saudi Arabia had initially shifted some exports to the Red Sea, but Iranian-backed Houthis have now gained control of the Bab al-Mandab Strait, further reducing supplies via this route.

The International Energy Agency (IEA) estimates that observed global oil stocks are down by around 507 million barrels from before the war, with consumption having dropped by more than one million barrels per day.