Global Oil Product Squeeze Worsens Amid Supply Disruptions and Seasonal Demand
The global refined oil product market is facing a severe squeeze due to supply disruptions and seasonal demand. Refinery throughput remains below last year's levels, with August throughput being 4.2 million barrels per day (bpd) lower than in the same period in 2025.
Despite an increase of 960,000 bpd from July, global refinery throughput rose to 81.4 million bpd in August, supported by a seven-year high in US crude processing and a recovery in China's refined product exports.
Russian refinery activity is expected to fall by around 1.2 million bpd year-on-year in the third quarter due to Ukrainian attacks on energy infrastructure, while Middle Eastern refinery activity is expected to decline by around 1.7 million bpd due to regional tensions, according to the International Energy Agency (IEA).
Rising refining margins highlight the tightness of refined oil markets, with diesel under particular pressure. Rystad Energy's Janiv Shah said the increase was driven by 'a global shortage of readily available refined products.'