Tight supplies, depleted stockpiles and disrupted exports are keeping diesel markets under pressure, with storage indicators pointing to prolonged shortages.
A global diesel shortage driven by wars in Iran and Ukraine is unlikely to ease before 2027, as depleted inventories and disrupted supplies keep fuel markets tight, according to storage market indicators and industry participants.
The supply squeeze has stranded millions of barrels a day in the Middle East and Russia, pushing inventories to historic lows and sending diesel prices sharply higher. The pressure is particularly significant because diesel is widely used in agriculture, manufacturing and heavy transportation.
In the US, retail diesel prices crossed $6 a gallon this month for the first time, adding to costs for farmers and truckers. Meanwhile, North American diesel storage capacity available for lease is rising, a sign that traders and refiners have little fuel to put into storage.
Storage capacity available for lease across North America and the Caribbean reached 13 million barrels for October, up from 11 million barrels in June, according to data from storage broker The Tank Tiger.
US diesel inventories fell to 107.9 million barrels as of September 11, the lowest level for this time of year since records began in 1982, according to the US Energy Information Administration.
The EIA expects US distillate inventories to remain below 100 million barrels from September through the end of 2026 and stay below the five-year low through most of 2027.
More from BusinessEurope is also facing tight supplies. Diesel inventories at the Amsterdam-Rotterdam-Antwerp trading hub were 16 per cent below the five-year average in July. Singapore’s distillate inventories have also remained below their 2025 average.
Industry executives expect global diesel supplies to remain tight through winter, particularly if Middle East tensions disrupt fuel exports further and Russia extends its diesel export restrictions.
There are some potential sources of relief. Record refining margins could encourage higher production, while China has steadily increased refined-fuel exports in recent months. However, further escalation of the Iran or Russia-Ukraine wars, or a major refinery outage, could trigger another surge in diesel prices.
