Diesel’s supply crunch leaves market crying out for barrels
7 July 2025
Time to read: minutes
“OPEC+ cuts have been making crude slates lighter — refiners produce less diesel with light crude,” said James Noel-Beswick, an analyst at Sparta Commodities. Cracks need to rise “to incentivize refiners to make more diesel,” he added.
Bloomberg, July 7, 2025 – Diesel markets are under intense strain as U.S. stockpiles hit their lowest seasonal level since 1996 and European cracks surge above levels seen during the Israel-Iran conflict. Refinery closures, outages, and OPEC+ production cuts — particularly of heavier crudes from Saudi Arabia and Russia — have tightened global diesel supply. James Noel-Beswick of Sparta Commodities noted that lighter crude slates mean refiners produce less diesel, pushing cracks higher to incentivize output. Despite healthy margins, risks like heatwaves, hurricanes, and limited imports into Europe’s ARA hub may keep inventories low heading into autumn.
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