US Diesel Prices Breach $5 Mark as Conflict Disrupts Global Supply

Industry analysts warn that the current price hike is likely to persist as multiple pressures converge on the energy market. Beyond the direct impacts of the Iran conflict, Russia has halted diesel exports following strikes on its refineries, while domestic US stockpiles have plummeted to their lowest levels in two decades. Experts suggest that these compounding factors could drive prices up by another 20 to 25 cents per gallon in the near term.

Global refining capacity has suffered significant setbacks, with reports indicating that 30 Middle Eastern refineries have been damaged or destroyed. This loss of output, combined with the ongoing disruption at the Strait of Hormuz, has forced US refiners to prioritize diesel and jet fuel production. Consequently, gasoline inventories have hit critical lows, depleting at three times the historical average over the past 16 weeks. International Energy Agency Executive Director Fatih Birol cautioned that if supply routes remain restricted, the global economy faces a potential fuel crisis that could intensify within weeks rather than months.