Building on our previous ePortal coverage, U.S. retail diesel set an all-time record Friday even as futures pulled back, while in Europe the crude-to-diesel crack spread has crossed $100 a barrel for the first time.
In the United States, AAA’s daily average retail diesel price hit $5.85 per gallon last week, breaking the previous record of $5.82 per gallon set in June 2022. The price has risen roughly $2.10 per gallon since the Friday before the Iran conflict began in early March.
Europe’s squeeze is now setting records of its own. The crack spread, diesel premium over crude, hit $104.08 a barrel for southern Europe deliveries this week, according to Argus Media, the first time European diesel cracks have ever topped $100. The premium pushed outright diesel prices to $198.73 a barrel in southern Europe Wednesday, still below April’s peak of $215. The FT reports diesel faces outsized pressure from Russia’s export ban, extended through September 30, plus limited Asian refinery exports and shrinking U.S. inventories. Argus estimates 1.3 million to 1.4 million barrels a day (15% to 20% of normal international shipments) are missing from the global market.
IAM Member Impact: With refining margins now above $100 a barrel on both sides of the Atlantic, members should likely treat this as a structural fuel cost shift rather than a temporary spike and build continued surcharges into Q4.
Source: FreightWaves; Financial Times