By: NATHAN STUEDLE
Diesel supplies could remain tight well into next year as disruptions in the Middle East and Russia continue affecting global fuel markets. The International Energy Agency reports combined diesel export losses from the two regions reached 1.3 million barrels per day during September. Attacks on energy infrastructure and reduced refinery production have pushed diesel refining margins to record highs, approaching 95 dollars per barrel.
The agency warns higher diesel prices are already contributing to inflation, increasing transportation costs and putting additional pressure on economic activity. That's especially concerning for agricultural producers who depend heavily on diesel fuel for harvesting, transportation and other farm operations. Although global refinery activity is expected to recover toward the end of the year, the IEA says that increase won't fully replace lost supplies. Seasonal refinery maintenance and stronger winter fuel demand could create additional pressure in the months ahead.