All articles tagged with #diesel shortage
Oil prices fell Monday as recovering Middle East exports and a G7 agreement to release 100 million barrels of fuel eased supply fears, despite ongoing tensions in Yemen and record-high diesel costs.
The Trump administration’s pressure campaign on Europe to release diesel from strategic reserves has succeeded, with G7 nations agreeing to release 100 million barrels of diesel and crude over four months. This move follows record-high diesel prices driven by refinery damage from the Iran and Ukraine wars, and comes after the US threatened an export ban to force European compliance.
Europe’s diesel crisis has intensified, with September imports hitting a record low of 1 million barrels daily. China has suspended all fuel exports to protect domestic supply, while President Trump has threatened to ban U.S. diesel exports to Europe unless Germany and France release 120 million barrels from strategic storage. The situation is exacerbated by the closure of 30% of EU refineries since 2009 and constrained Russian supplies, forcing the EU to rely on stockpile releases to maintain supply.
The G7 has agreed to release 100 million barrels of oil and diesel from strategic reserves over four months to stabilize soaring fuel prices. This coordinated action, led by the International Energy Agency, averts a threatened US export ban on diesel. While the move aims to lower costs for consumers and businesses, experts warn that depleting emergency stocks without clear replenishment plans poses long-term risks, especially amid ongoing geopolitical conflicts.
A sharp divergence has emerged between physical and futures oil markets, with Dated Brent exceeding $120 per barrel while ICE Brent trades near $101. This gap signals severe physical tightness driven by a European diesel stock release, China’s reinstated fuel export ban, and ongoing disruptions in the Strait of Hormuz. OPEC+ is expected to maintain November output quotas, while the US Department of Energy offers the final tranche of its emergency strategic reserve drawdown. Global fuel subsidies are projected to surpass $1 trillion as governments struggle to manage rising energy costs and supply constraints.
Oil prices retreated on Tuesday as Middle Eastern crude exports rebounded to 15.5 million barrels per day, yet Standard Chartered raised its 2026-2027 forecasts, citing persistent geopolitical instability and thin supply buffers. While Saudi Arabia restored pipeline flows, diesel prices hit record highs, prompting potential U.S. policy interventions.
Cuba says it has run out of diesel and fuel oil, pushing the national grid into a critical state and triggering severe blackouts in Havana as the US blockade hinders fuel imports. The energy minister says the country has no reserves and must rely on domestic crude, natural gas and renewables, with solar capacity limited by grid instability. Cuba is seeking fuel from abroad despite global price pressures; Mexico and Venezuela have not supplied fuel since early 2026, and only one large tanker, the Anatoly Kolodkin, has delivered crude since December. The UN has condemned the blockade as unlawful, citing harm to Cubans’ access to development, health, and basic services.