Diesel Prices Rise in Europe: Refineries Near Max Capacity — NRG-IA

Europe currently has enough crude oil to avoid an immediate supply crisis, but the fuel market is sending a different signal. Diesel and jet fuel remain expensive, commercial inventories in the Amsterdam-Rotterdam-Antwerp (ARA) hub are below the five-year average, and European refineries are operating near maximum capacity, according to an assessment published on September 29 by the European Commission. The pressure stems from a major shift in the global oil market: the availability of crude oil does not automatically guarantee the availability of refined products. Crude must be transported and processed, and global refining capacity—disrupted in the Middle East, Russia, and Asia—has not been fully offset in other regions. Data from the International Energy Agency (IEA) highlights the scale of the issue. In August, global refineries processed approximately 81.4 million barrels per day , which is 4.2 million barrels per day less than a year earlier . The deficit is particularly visible in middle distillates, the category that includes diesel. The Gulf and Russia Have Lost 1.6 Million Barrels/Day in Diesel Exports Net exports of diesel and gasoil from the Gulf states fell in August to approximately 390,000 barrels per day , just over a quarter of pre-war levels, according to the IEA. Together, the Gulf and Russia exported about 1.6 million barrels per day less diesel than in February . Prior to the disruptions, these two sources accounted for nearly 45% of global seaborne trade in diesel and gasoil . This reduction is large enough to alter the balance of a global market that lacks unlimited refining capacity in other regions. In August, exports of refined petroleum products and LPG from the Gulf were still about 3.7 million barrels per day, or nearly 60%, below February levels . This highlights one of the paradoxes of the current oil market: crude flows can recover without diesel and jet fuel returning to their previous prices. A barrel of available crude must reach a refinery capable of processing it, and the resulting products must then be transported to markets where demand exists. Europe Has Pushed Its Refineries Close to Maximum Capacity The European Commission confirms that European refineries are responding to high prices with utilization rates near maximum capacity. While this high output helps Europe offset some of the reduction in international refined product flows, it also reduces the operational buffer available in the event of a new disruption. An unplanned shutdown of a major refinery, a further reduction in Russian exports, or additional issues with Middle Eastern flows would thus hit a European system that is already heavily utilizing its existing capacity. This pressure is also visible in Amsterdam-Rotterdam-Antwerp, Europe's main hub for oil and refined products. The Commission notes that ARA commercial stocks are below the five-year average , although levels have stabilized in recent weeks. The combination of below-average commercial inventories, refineries operating near maximum capacity, and tight global refined product supply explains why prices can remain high even as Europe continues to receive sufficient crude oil. Diesel Prices Have Risen Far More Aggressively Than Crude Oil The gap between the crude oil market and the refined products market has become extreme in recent months. The IEA shows that, in early September, diesel had surpassed $200/barrel in the United States , approximately 94% above its pre-war level , with prices in Europe and Asia hovering near those figures. The much faster rise in refined product prices compared to feedstock has pushed Atlantic Basin refining margins to record highs. For Europe, this gap has economic consequences far beyond diesel passenger cars. Diesel directly impacts the costs of road freight, agriculture, construction, and logistics. A prolonged period of high prices can thus pass additional costs onto numerous sectors of the economy. Eurostat data from August already showed the impact on consumers: prices for personal transport fuels and lubricants in the EU were 23.8% higher than in August 2025 . Diesel prices rose by 8.3% between July and August alone at the European level. In Romania, diesel prices increased by 6.1% in a single month , while gasoline rose by 6.6% . Jet Fuel Spreads Oil Pressure to Aviation The second area explicitly highlighted by the European Commission is aviation fuel. Jet fuel prices remain high in the same tight global distillate market, and the impact is starting to become significant for airlines. Lufthansa estimates that rising fuel costs will generate an additional impact of over €1.5 billion in 2026. The company had previously estimated a total fuel cost of approximately €8.66 billion for this year. The persistence of high jet fuel prices could thus maintain pressure on the costs of the European aviation industry at a time when the oil market is entering the cold season with a reduced capacity to absorb new…