Global diesel markets are faced with the most severe supply squeeze in years as refinery outages linked to conflicts in the Middle East and Russia drive global refining activity to its lowest level for this time of year since the COVID-19 pandemic, according to Goldman Sachs.
The investment bank said diesel has become the “epicentre” of the global fuel shortage, with shrinking refinery output tightening supplies even as crude oil production remains relatively resilient.
Goldman Sachs analysts estimated that global refining throughput in July has fallen by as much as 6.5 million barrels per day (bpd) compared with the same period last year.
The decline reflects lower refinery runs in China alongside war-related disruptions across the Middle East and Russia.
The sharp drop in refining activity has hit diesel hardest. According to the bank, global diesel exports have declined by around 35 percent, or approximately 2.6 million bpd, this month, leaving inventories below seasonal norms and increasing the risk of further supply shortages.
