Refined fuel markets are witnessing increasing pressure as gasoline and diesel supplies remain scarce, at a time when the International Energy Agency warns that geopolitical tensions and supply disruptions may push prices to rise further in the coming period.
The agency explained that the decline in global inventories, the high demand during the summer travel season, in addition to the disruption of part of the exports of petroleum products linked to Russia and the Middle East, contributed to tightening market conditions.
Developments in Russia affected diesel exports, while tensions in the Middle East limited the pace of some Gulf refineries’ exports of gasoline, diesel, and jet fuel, which was reflected in global fuel markets.
These factors pushed refining margins to rise, as the diesel refining margin in Europe exceeded $60 per barrel, while the European gasoline premium rose to about $41 per barrel above the price of crude, recording its highest levels since the summer of 2022.
The International Energy Agency warned that any new escalation in tensions, especially in the Middle East, may increase pressure on supply chains, in light of the continuing repercussions of shipping and refining disruptions.
Analysts believe that the rise in refined fuel prices may reflect on the costs of transportation, shipping, industry, and agriculture, adding new inflationary pressures on the global economy, while markets await in the coming days OPEC’s monthly report and US inflation data to assess the path of energy markets.
