Tight diesel supplies threaten to raise transport, heating costs
Refining margins-the difference between the price of crude oil and revenue from the refined products-were poor in the fourth quarter of 2024 and prompted refiners to run at slower rates, said James Noel-Beswick, an analyst at Sparta Commodities.
“For Europe, the U.S. became really important because of the Russian diesel sanctions, so when you have low U.S. exports to Europe, it’s even more important,” said Noel-Beswick of Sparta.
Wall Street Journal, July 9, 2025 – Diesel supplies remain tight despite refineries running near full capacity, raising concerns ahead of peak autumn demand. James Noel-Beswick of Sparta Commodities noted that poor refining margins last winter led to run cuts, leaving inventories low. Sanctions on Russian oil and OPEC cuts have reduced heavy crude availability, impacting diesel output, especially in Europe, which now relies heavily on U.S. imports. Global distillate stocks remain well below average, and analysts warn that limited refining capacity, weather disruptions, and strong demand could drive prices higher, potentially fueling inflation.
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