Diesel fuel shortage becomes a new problem

In the world market, a new deficit that has crept up unnoticed and has already caused serious concern is the lack of diesel fuel. He took his place in the list of already existing deficits:

coal, microchips in the automotive industry, electricity and gas, fertilizers and, ultimately, the coming food shortages. Deliveries of diesel fuel to the world market are reduced, and the West discovers its global shortage. This process, during the beginning of spring agricultural work, can significantly exacerbate the effect of shortage and high cost of fertilizers.

Insights Global, a Dutch consulting company, presented fresh data that does not cause optimism: only last week, stocks of diesel fuel and fuel oil in storage in the European processing and storage area Amsterdam – Rotterdam – Antwerp (ARA) decreased by 2.5%. This is the lowest level for the same season since 2008.

The shortage of diesel fuel is most obvious in Europe, but it cannot be called local. For example, middle distillate stocks in Singapore also fell to a multi-year low: 8.21 million barrels. How not to note that China, back in the first decade of last month, sharply limited the export of petroleum products, including diesel fuel. This factor could not but affect the market throughout Southeast Asia.

Reuters notes that diesel prices in northwestern Europe hit $114 a barrel last week, the highest since September 2014. Also, the difference in price in relation to crude oil reached a 2-year high. At the same time, diesel fuel prices reached their highest level since September 2014 in Asia as well.

In terms of retail sales (in rubles), the situation now looks like this: a liter of diesel fuel in Moscow costs 50-60 rubles, in Minsk 60-65 rubles, in Kiev 85-105 rubles (but of poor quality), in Seoul 95-105 rubles, in Berlin 140-150 rubles.

At the same time, as he writes RIA News, the estimate of the delivery of diesel fuel to Europe in February from other regions was revised downward – from 1.83 million tons to 1.66 million tons, which is 2.7 times lower than in January. A US broker told Reuters: “We are seeing minimal exports of diesel from the Gulf Coast to the US and zero storage capacity on clean ships.”

At the same time, most analysts expect a further increase in oil prices – first to $100 per barrel, and then higher. In the context of supply shortages, this will further accelerate the increase in diesel prices.

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