Oil Market Tightens Further as Diesel Shortage Deepens
The oil market remains under intense pressure due to disruptions in crude and refined product supplies from the Strait of Hormuz crisis, according to the International Energy Agency's (IEA) latest Oil Market Report.
While crude oil prices have risen sharply, the impact on refined products has been even greater, with market tightness now particularly severe for diesel. The squeeze reflects severely constrained product exports from the Gulf, compounded by disruptions to Russia’s refining system and a near-halt in its product exports following intensified Ukrainian attacks.
The IEA reports that net diesel and gasoil exports from the Gulf and Russia were 1.6 million bpd lower in August than before the Middle East conflict. With the conflict continuing to disrupt oil flows, the IEA has lowered forecasts for both global oil supply and demand this year.