The International Energy Agency warned that a worldwide diesel shortage triggered by war-damaged refineries in the Middle East and Russia will extend into 2027, despite efforts including a temporary lifting of Russian trade sanctions. The supply disruption has already created significant economic pressures, raising costs for businesses and consumers across agriculture, manufacturing, shipping, and logistics sectors. Diesel accounts for approximately 10% of global energy consumption and is essential for powering industrial equipment and transportation infrastructure.
While the shortage presents broad economic challenges, major refinery operators are preparing for record profitability. TotalEnergies reported that its refining and chemicals division generated $1.8 billion in income between April and June, more than quadrupling from previous periods. The company characterized previously underperforming European refineries as newly profitable assets in the constrained market. Shell announced expectations of record-per-barrel profits in the July-to-September period, with refining margins forecast to nearly double to $42 per barrel compared to $24 in the prior quarter.
US-based refiners are experiencing particularly strong gains, with fuel product exports climbing by over 50% in the past year to reach an all-time high of approximately 1.9 million barrels daily over the summer. The combined market value of three major US refiners—Marathon Petroleum, Valero Energy, and Phillips 66—has more than doubled since the crisis began, with their shares gaining a combined $215 billion in value.
Refinery operators attributed their performance to operational flexibility in response to shifting demand patterns. BP executives noted the company’s ability to redirect diesel shipments to Australian markets and increase jet fuel production by 30% to address European supply gaps. The price advantage available to refiners stems from the differential between crude oil benchmark prices, which have eased back toward $100 per barrel, and significantly higher refined fuel values driven by constrained global stockpiles and limited export capacity.
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