Diesel Refining Margins Set to Soar on Global Shortage
Goldman Sachs has revised its forecast for refining margins, citing rising strikes on refineries in the Middle East and Russia. The bank's analysts expect diesel refining margins to reach $63 per barrel in the United States in 2027, up from an earlier estimate of $27 per barrel.
The global diesel shortage is driving this increase, as refinery outages are currently 60% higher than the seasonal average. Fuel exports from the Persian Gulf are running at 40% of pre-war levels, compared to 70-80% for crude oil exports.
In Europe, the situation is complicated by a shortage of refineries due to EU climate regulations forcing energy companies to shut down refining capacity in anticipation of demand destruction that has yet to materialize. Russia's diesel export ban, extended until September 30th, is also contributing to the global tightness in diesel.