Europe hits decade low in diesel imports, faces potential autumn shortage
In May, diesel imports to Europe fell to their lowest level in ten years, dropping by a third compared to the previous year. Experts warn that continued tensions in the Middle East could lead to a deficit and price hikes in the autumn.
Europe has experienced a significant decline in diesel imports, with May recording the lowest level in a decade – one-third less than the same month last year. Inventories of diesel have also decreased, forcing a reassessment of supply chains and increased utilization of oil refineries.
The drop in imports is primarily due to a near halt in shipments from the Middle East. This has been partially offset by increased supplies of diesel and heating oil from the United States, as well as higher output from European refineries. However, due to the US-Iran conflict, the Strait of Hormuz has been closed for 15 weeks, with Iran signaling that future passage may require payment. Meanwhile, Houthi groups in Yemen are escalating tensions in the Red Sea.
Circle K fuel pricing manager Indreks Sasi noted that there is currently no shortage, but if US-Iran talks show no progress, supply disruptions from the Middle East will continue indefinitely. This could pressure prices in autumn when the heating season begins, especially if US exports cannot fully meet European demand, as US crude stocks have also declined.
Aviation fuel imports have also fallen to a six-year low. Due to high summer tourism demand, some airlines have had to reduce flights, according to Sasi. Oil prices surged mid-week after Iran shot down a US Apache helicopter and the two countries exchanged airstrikes.
The Middle East tensions are affecting not only Europe but other regions as well. India, which imports about 85% of its oil, used to get half from the Middle East before the conflict; now it is buying record volumes from Russia and additional supplies from Venezuela and Brazil. Brent crude is currently trading around $91–92 per barrel, roughly 40% higher than at the start of the year.
