NEW YORK / RankWire.AI / – On Wednesday, diesel prices stayed high as limited refined-product availability continued to exert upward pressure on fuel markets across the United States and Europe. U.S. ultra-low sulfur diesel futures surged 7.4% on Monday, closing at $4.19 a gallon, marking the largest single-day increase since July 13. Early Wednesday trading pushed the contract close to $4.28 a gallon, while in Europe, diesel refining margins stayed at historically elevated levels after rising nearly 10% on Monday.
As of August 10, the average retail price of diesel in the U.S. was $5.257 per gallon, compared to $5.348 the previous week. These prices remain significantly above the $4.578 recorded on July 6. According to the U.S. Energy Information Administration, distillate stocks decreased by 3.5 million barrels during the week ending July 31, bringing inventories down to 107.2 million barrels from 110.6 million a week earlier. This total was 5.1% lower than a year prior and 16.1% below the same period two years ago.
Europe has encountered similarly high costs in converting crude oil into diesel. The premium for European low-sulfur gasoil over crude hit a record $74.66 a barrel on July 30. Meanwhile, European diesel margins increased by almost 10% on August 10. The European Central Bank reported that diesel pump prices averaged around €1.98 per litre during the third week of July. Its analysis indicated refining margins contributed about €0.35 per litre during the first three weeks of July, a sharp rise from earlier levels.
Refinery outages diminish available diesel supplies
Disruptions at refineries have further reduced fuel output, aggravating an already tight international market. An attack targeted a refinery in Russia’s Tatarstan region, compounding the decrease in Russian refining capacity. Additionally, Saudi Arabia’s Jazan refinery has remained offline since July 27 following an earlier attack. These interruptions impact regions that typically supply substantial volumes of refined petroleum products globally. Throughout June, global refinery runs had already fallen notably below the levels of the previous year, with several major centers operating at reduced capacity.
Russia has also implemented export restrictions on diesel, extending these limits through January 31, 2027. Disruptions in Middle East shipments have been intensified by sharply reduced vessel traffic through the Strait of Hormuz, which has fallen well below pre-conflict levels. Moreover, China’s decreased refining activity has further limited the flow of petroleum products into international markets during a period of strong refining margins.
Despite high refinery activity, diesel market faces tightening supply
U.S. refiners processed large volumes of crude oil while domestic inventories of fuel remained at low levels. Federal energy data shows that crude input to U.S. refineries during the first seven months of 2026 reached the highest point since 2019. As margins stay strong, refinery utilization remains high, supporting continued processing. Nonetheless, distillate inventories as of August are at their lowest for this time of year in about three decades. Diesel and heating oil are included in the distillate category tracked weekly in U.S. petroleum statistics.
Crude oil prices also increased Wednesday, with Brent nearing $89.81 a barrel and U.S. West Texas Intermediate around $84.08. Diesel markets have experienced intensified pressure due to tightening supply amid refinery disruptions and export limitations. Diesel remains a vital fuel for trucking, agriculture, construction, manufacturing, and numerous other commercial sectors. The combined effect of low U.S. inventories, record European refining margins, and reduced international refinery output has kept refined-product markets tight across both the Atlantic and Pacific regions.