Analyst Warning of Diesel Crisis: Middle East and Russian Refineries Tighten Supply

Global Diesel Market The latest developments signal a serious crisis in the global diesel market.
Supply constraints in the Middle East and Russia are keeping prices high while dampening demand.
Middle East and Russia Refinery Issues Prolonged conflict in the Gulf of Basra has disrupted production in the region, while drone attacks on Russian refineries continue to limit output.
Vitol Group CEO Russell Hardy noted that the loss of fuel exports from major refining hubs in the Middle East and Russia has reached about 2 million barrels per day for each region.
“We still cannot fully utilize refinery capacity to offset these disruptions,” Hardy said.
Impact on Prices ICE diesel reference prices have risen more than twice the increase seen in Brent crude.
Crude prices have approached $100 per barrel for the first time since July.
In the United States, retail diesel prices have surpassed the peak recorded in June 2022, reaching record levels.
Market Outlook When refineries operate at high capacity for extended periods, they become vulnerable to failures.
Limited buffer stocks mean that any interruption could exacerbate the crisis.
Kuwait Petroleum has warned that if the situation persists until the end of the year, it could lead to a significant shortage of fuels.
The company also cautioned that a harsh winter in Northwestern Europe could further strain supplies.
Analysts say these developments could trigger long‑term volatility in fuel markets, urging consumers to prepare for price increases.