Middle East conflict is turbocharging diesel prices

The Israel-Iran conflict has boosted global diesel prices, with gains outstripping the jump in crude prices, highlighting the vulnerability of diesel-heavy European consumers even as the region's refiners get a windfall.

- Ron Bousso

Benchmark Brent crude prices have risen by 10% to over $76 (2,492 baht) a barrel since the start of the Israel-Iran war on June 13, reflecting investor concerns about potential disruption to supply in the Middle East, particularly issues related to the Strait of Hormuz, a narrow waterway between Iran and Oman, through which around a fifth of the world’s crude oil and refined products passes.

Amid the turmoil, benchmark diesel prices have rallied, particularly in Europe. Benchmark European ICE Low Sulphur Gasoil prices have gained nearly 15% since June 12. The past days' rally built on strengthening diesel prices in recent months on the back of robust global demand and low inventories in Europe and the United States.