Constraints on the diesel market will extend well into next year, the International Energy Agency warned on Wednesday.
In its October Oil Market Report, the IEA said supply would remain tight into the latter half of 2027.
A counter-seasonal tightening in gasoil markets in the third quarter, combined with "much heavier-than-normal inventory declines" in the preceding three months, had "deprived global gasoil markets of crucial stock cover ahead of the peak winter demand season," the IEA said.
Last month saw global diesel exports drop by 700,000 barrels a day year-on-year, according to IEA data. A 1.3 million barrels per day loss from Russia and the Middle East was "only partly offset by higher supply from other sources," the agency said.
But while higher prices had weakened oil demand more broadly, the IEA said "relatively price inelastic diesel demand has remained strong," supported by government measures aimed at easing high prices for consumers.