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Diesel squeeze set to last well into 2027 as Iran war disrupts supply, IEA says
The agency said 1.3 million barrels a day of export losses and weak refining output are keeping wholesale and retail prices at record highs.
- On Wednesday, the International Energy Agency warned that global diesel supply constraints will persist well into 2027, driven by prolonged strain and counter-seasonal stock draws ahead of peak winter demand.
- Diesel refining margins soared to record highs of almost $95 per barrel in September as attacks linked to the Iran war slashed production and depleted crucial stock cover.
- Wholesale diesel prices reached all-time highs of around $220 per barrel in Europe and the United States, with the IEA advising that record prices are "having broad economic consequences by raising the cost of goods and impacting inflation."
- Last week, President Donald Trump announced a deal with Russian counterpart Vladimir Putin for Russia to immediately supply 300,000 metric tons of diesel to the global market to offset price rises.
- European Commissioner Valdis Dombrovskis warned that "now is not a time to ease sanctions on Russia," questioning whether the deal's volumes have macroeconomic significance, while the IEA projects supply shortages will continue through the second half of 2027.
Insights by Ground AI
22 Articles
22 Articles
The "extremely tense situation on the diesel market is further exacerbated by the approaching winter. Neither Trump's deal with Russia nor reserve clearances change anything about this.
·Düsseldorf, Germany
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Farmers, transporters, and motorists must reckon with persistently high diesel prices. The diesel market will remain too tight well into 2027, despite American claims that Russia will supply additional diesel to the United States. Even the release of emergency stockpiles will not sufficiently alleviate the shortage. As a result, prices remain high.
·Amsterdam, Netherlands (Kingdom of the)
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Coverage Details
Total News Sources22
Leaning Left1Leaning Right4Center5Last UpdatedBias Distribution50% Center
Bias Distribution
- 50% of the sources are Center
50% Center
C 50%
R 40%
Factuality
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