The International Energy Agency (IEA) warned on Wednesday that diesel supply shortages could persist until next year, due to significant draws from inventories and ongoing production constraints, as the winter peak demand season approaches.
Reuters quoted the agency in its monthly oil market report, stating that diesel markets still face significant pressure, as continuous supply disruptions have led to inventory draws, contrary to the usual seasonal pattern before refinery maintenance in autumn and rising demand during winter.
It noted that diesel prices, which have reached unprecedented levels, are beginning to trigger wide economic repercussions by increasing goods costs and affecting real incomes, economic activity, and inflation rates.
Recovery and Deficit Projections
The agency predicted that the recovery of global refining operations by the end of this year would help refill inventories, but it would not be sufficient to compensate for the accumulated deficit during the year.
It added that member countries are coordinating to draw down 100 million barrels of oil and diesel from strategic reserves in an attempt to calm prices, given the widespread importance of this fuel in industrial, agricultural, and transport sectors.
Export Losses and Demand Decline
The agency stated that combined diesel export losses from the Middle East and Russia reached 1.3 million barrels per day in September, anticipating a decline in global oil demand by 2.6 million barrels per day in 2026, with 25 percent of that decline attributed to diesel.
According to the report, diesel refining profit margins reached approximately $95 per barrel last September, with production declining due to reduced refining capacity resulting from attacks linked to the US-Iranian war.
The agency also expects global oil supply to decrease by 5.8 million barrels per day this year, before reversing course and rising by 7.7 million barrels per day in 2027 to restore a surplus to the global oil market.
Source: Syrian Arab News Agency (SANA)
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