NEW YORK / RankWire.AI / – On Wednesday, market analysts reported that diesel prices stayed high due to restricted refined-product supplies impacting fuel markets across the United States and Europe. The U.S. Energy Information Administration noted that U.S. ultra-low sulfur diesel futures soared 7.4% on Monday, settling at $4.19 a gallon. This was the largest single-day increase for the contract since July 13. Early trading on Wednesday saw the futures close in on $4.28 a gallon, while European diesel refining margins persisted at historically elevated levels after nearly a 10% rise on Monday.
As of August 10, the average retail price of diesel in the U.S. was $5.257 per gallon, slightly down from $5.348 a week prior. Nonetheless, prices remained significantly above the $4.578 average recorded on July 6. The U.S. Energy Information Administration also reported a decline of 3.5 million barrels in distillate inventories during the week ending July 31, bringing stocks down to 107.2 million barrels from 110.6 million a week earlier. This represented a 5.1% decrease compared to the same period last year and a 16.1% drop from two years ago.
European fuel costs have also reached record levels for converting crude oil into diesel. The premium for European low-sulfur gasoil over crude hit an all-time high of $74.66 a barrel on July 30. Subsequently, European diesel margins increased by nearly 10% on August 10. The European Central Bank indicated that diesel pump prices hovered around €1.98 per litre in the third week of July. Its analysis revealed that refining margins contributed approximately €0.35 per litre during the initial three weeks of July, a sharp rise from previous levels.
Refinery disruptions diminish diesel supply available on the market
Unplanned refinery outages have further constrained the global supply of diesel from an already limited pool. An attack targeted a refinery in Russia’s Tatarstan region, compounding a decline in Russian refining activity. Meanwhile, Saudi Arabia’s Jazan refinery has been offline since July 27 following an earlier attack. These disruptions impact regions that typically export significant amounts of refined petroleum products worldwide. During June, global refinery throughput was substantially below levels from the previous year, as several key refining centers operated at reduced capacity.
Russia has also extended restrictions on diesel exports, now set to remain in place until January 31, 2027. Additionally, Middle East shipments face further delays due to sharply reduced vessel movements through the Strait of Hormuz, with traffic dropping well below pre-conflict levels. China’s declining refining capacity has also contributed to the limited flow of petroleum products into global markets during a period of high refining margins.
Refining capacity remains high, yet diesel supplies tighten
Despite strong refinery activity in the U.S., domestic fuel inventories continue to be low. Data from federal agencies show that crude input to U.S. refineries in the first seven months of 2026 reached their highest point since 2019. Refinery utilization rates have stayed elevated, supported by favorable margins. However, distillate stocks, which include diesel and heating oil, were at their lowest for this time of year in approximately thirty years as August began. Weekly U.S. petroleum statistics monitor these distillate inventories closely.
Crude oil prices also gained momentum Wednesday, with Brent approaching $89.81 a barrel and U.S. West Texas Intermediate near $84.08. The diesel market remains under increased pressure, driven by the tightening of finished fuel supplies amid ongoing refinery disruptions and export restrictions. Diesel continues to be vital for sectors such as trucking, agriculture, construction, and manufacturing. The combination of dwindling U.S. inventories, record European refining margins, and reduced international refinery output has sustained tightness across fuel markets on both sides of the Atlantic.