Key facts
- Global diesel supply is expected to remain below 2025 levels until at least mid-2027.
- Refineries in the Middle East and Russia are significantly impacted by conflict and strikes.
- Saudi Aramco's Jizan refinery is still shut following multiple hits.
- Half of Russia's refineries are offline, leading to a ban on diesel exports.
- A deal for Russia to supply diesel to the US saw the first tanker depart last week.
- Analysts deem the Russian diesel deal to have negligible impact on global supply.
The global diesel supply crunch is expected to continue until at least mid-2027, driven by ongoing disruptions in the Middle East and Russia, according to analysts. Refineries in the Middle East, damaged by Iranian strikes, and Russian refineries affected by Ukrainian drone hits, have significantly reduced global supply. While other regions are producing at full capacity, they cannot fully offset the lost volumes and are deferring essential maintenance, risking further disruptions. Shipping challenges, including increased danger and the use of smaller tankers for fuel exports from the Persian Gulf, further complicate the supply situation. The impact of recent deals to increase Russian diesel exports to the US is considered negligible by experts.