Global diesel shortage may persist until 2027 as stocks hit historic lows

A global diesel shortage, fueled by wars in Iran and Ukraine, is unlikely to ease before next year, with fuel prices at record levels and stocks at historic lows, raising costs for transport, agriculture, and manufacturing. The squeeze stems from limited refining capacity, not a lack of crude oil. US diesel stocks hit 107.9 million barrels on September 11, the lowest for that date since 1982, and are expected to stay below the five-year low through 2027. Disruptions in West Asia, Russia, and China have removed about 5 million barrels per day of crude-processing capacity, nearly 10% of global supply. US refineries ran at 97% capacity in July, leaving little room to boost output, and retail diesel prices have crossed $6 a gallon. Some relief may come from rising Chinese exports, but the market remains vulnerable to further war escalation or refinery outages.