Diesel shortage and refinery capacity risk in global markets

Due to the war in the Persian Gulf and Ukraine's unmanned aerial vehicle attacks on Russian refineries, the risk of a diesel crisis has emerged in international markets; experts emphasized that refinery capacity is at its limit.

Main Causes and Losses of the Crisis

Analysts draw attention to the war in the Persian Gulf, which has lasted for more than six months, and Ukraine's unmanned aerial vehicle attacks on Russian refineries.

Vitol Group CEO Russell Hardy stated that lost fuel exports from refining hubs in the Middle East and Russia have each reached 2 million barrels per day.

Price Increases and Inflationary Pressure

The increase in diesel prices, the engine of the global economy, has reached a rate more than double the increase seen in Brent crude oil prices.

As crude oil prices head towards $100 for the first time since July, retail diesel prices in the US have seen new record levels.

Refineries Pushed to the Limit

As refineries in other regions have reached their capacity limits, consumers have been forced to turn to distillate fuel stocks.

The vulnerability of refinery equipment operating at high capacity for long periods to breakdowns poses a risk at a time when existing buffer stocks are limited.

Winter Season and Approaching Danger

Sheikh Khaled Al-Sabah, one of the executives at Kuwait Petroleum, stated that it would be a success for the global refining system to endure until the end of the year.

Experts report that a very difficult winter period is expected, especially in import-dependent regions like Northwest Europe, as temperatures drop.