Overview
- The Energy Information Administration said Wednesday that U.S. distillate inventories will fall below 100 million barrels in September and remain below the five‑year low through much of 2027, and it raised its 2026–27 retail diesel price forecasts.
- Industry leaders at the APPEC conference warned the market will tighten further this winter because many refineries are operating at or above safe maximums and cannot lift output quickly.
- Russian refinery damage and export bans together with Middle East outages and shipping disruptions have cut global diesel exports sharply, leaving a structural shortfall in middle distillates.
- U.S. refiners running near 98 percent utilization and a surge in U.S. product exports have helped global buyers but also drained domestic stocks, and a White House meeting of refiners on Sept. 1 produced no immediate supply fix.
- Higher diesel prices are already pushing up freight and heating costs and could push the U.S. average retail diesel toward or above $6 per gallon in days, with persistent tightness likely to feed into food and consumer prices and complicate policy choices.