Diesel squeeze set to last well into 2027 as Iran war disrupts supply, IEA says
The agency said falling inventories and reduced refinery output are keeping wholesale and retail prices at record levels.
- 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.
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Reformatorisch Dagblad
welingelichtekringen.nlThe global supply of diesel and other fuels is expected to remain tight well into 2027, warns the International Energy Agency (IEA). According to the agency, the supply of diesel in particular, a key fuel for the transport sector and agriculture, is "under extreme pressure" due to supply disruptions caused by conflicts in the Middle East and damage to Russian refineries following Ukrainian attacks.
Production remains limited, stocks are abnormally reduced before winter.The International Energy Agency warns of a continuing diesel shortage – well into the coming year.
The International Energy Agency (IEA) anticipates an improvement in world diesel production at the beginning of 2027, but this will be insufficient to compensate for the deficit accumulated in 2026 and "the market will remain tense in 2027", she warned Wednesday. ...
The situation on the diesel market, whose prices are blazing, remains dependent on a recovery in the supply of oil products from the Middle East, the IEA believes.
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.
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