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OIL PRODUCTS: Global Diesel Market to Find Price Support in 2025
The global diesel market will likely find price support in 2025 from the closure of about 1% of refining capacity, analysts told Reuters.
- This will offset the current weakness and structural downward pressure as the world shifts to cleaner fuels.
- Around 1m b/d of refining capacity will permanently come offline in 2025 due to weak profits.
- Meanwhile, global demand is seen rising slightly by around 95k b/d, according to the IEA.
- FGE expects diesel demand to contract by 230k b/d year-on-year over Jan-Dec amid forecasts that the northern hemisphere winter will be the coldest in 10 years and cut road fuel use.
- Changes to shipping rules in the Med region from May will make it an Emission Control Area and should bolster gasoil demand by 50k b/d.
- JP Morgan expects European diesel margins to trade around $17-$19/b in 2025, rising to $21/b in 2026.
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.