US diesel hits four-year high as Russia's export ban and Iran war squeeze supply

US diesel is the highest it has been since mid-2022, and for anyone moving freight that lands straight on the fuel surcharge line. Carriers peg those surcharges to the weekly diesel average, so a four-year high means shippers pay more per mile and haulers watch their margin on every load that isn't fully covered.

The cause is offshore. Damaged refineries in the Middle East and Russia have pulled diesel out of the global pool, and there isn't spare capacity elsewhere to fill the hole. Iranian and Houthi strikes on Persian Gulf facilities cut supply and deliveries out of that region. Ukrainian strikes on Russian refineries pushed Moscow to ban diesel exports. Take barrels off the water in two places at once and the US, which trades into the same market, pays up too.

The surcharge squeeze

Fuel surcharges are supposed to make diesel a pass-through, but they lag. The surcharge resets on last week's average while the driver buys this week's fuel, so a fast climb leaves the carrier eating the gap until the table catches up. Owner-operators and small fleets feel it first because they have the least cushion. Fuel haulers face the same math on their own trucks even as the product they carry gets more valuable.

Europe's record premium

The diesel premium in Europe hit a record high, per the Financial Times, with retail diesel nearing 2.2 euros in some European cities. When European buyers bid diesel up to close their own shortfall, US Gulf Coast product gets pulled toward export. That tightens supply here and holds the domestic price up.

Into 2027

Analysts cited by OilPrice say the refining crunch could keep fuel prices elevated into next year, because the missing capacity doesn't come back fast. A refinery hit in a strike isn't a switch you flip. If that read holds, haulers may be looking at a higher diesel floor for several quarters rather than a spike that fades in a few weeks, which changes how you'd price a contract signed now.

What to watch

Whether the Russian export ban gets extended or eased is the near-term swing factor on global diesel. Watch the EIA weekly diesel average, since that's what your surcharge tables run off. And watch whether Gulf Coast diesel keeps drawing toward export as long as Europe's premium stays wide, because that's what decides how tight the US market gets from here.