Diesel prices in key global markets, including the USA, Brazil, and China, are undergoing significant shifts due to evolving supply-demand dynamics, geopolitical pressures, and economic conditions. The global trade is influenced by factors such as weather patterns, refinery throughput, fuel policies, and trade realignments.

In the United States, Diesel prices have been fluctuating due to demand shifts and seasonal weather patterns. The winter storm Enzo recently led to a surge in heating fuel consumption, temporarily pushing Diesel demand to multi-year highs. However, forecasts now suggest warmer-than-usual temperatures across major markets, leading to reduced consumption of heating fuels.

U.S. distillate fuel inventories dropped sharply, with Diesel stockpiles falling by 5 million barrels in late January. This decline was driven by strong demand during the winter season, as well as logistical challenges caused by severe weather disruptions in the Gulf Coast region, affecting supply chains and refining capacity.

Meanwhile, U.S. Gulf Coast Diesel exports have seen a surge, particularly towards Europe and South America. Despite Mexico’s energy independence efforts, demand for U.S. Diesel remains strong in Central and South America, particularly as Brazilian and Argentine markets continue to seek additional supply to meet agricultural and transportation needs.

Brazil, a key Diesel consumer, has been significantly impacted by shifting trade flows and domestic refining constraints. With limited spare refining capacity, the country continues to rely heavily on Diesel imports, particularly from Russia and the USA, to meet growing domestic demand.

Russia has emerged as Brazil’s primary Diesel supplier, accounting for approx. 65% of total Diesel imports in 2024. Competitive pricing and favorable trade conditions have allowed Russian exporters to strengthen their market share, reducing dependence on traditional suppliers such as the USA and the United Arab Emirates.

Brazil’s demand is expected to remain robust in 2025, driven by its agricultural sector and logistics industry. However, slowing economic growth and inflationary pressures could moderate overall fuel consumption. The central bank forecasts GDP growth of 2% in 2025, down from 2024, potentially dampening Diesel demand.

China, the world’s second-largest consumer, has seen weakening demand due to economic slowdowns and structural shifts in transportation. The country’s refining throughput fell in 2024, marking the first annual decline in decades, excluding the pandemic period.

Sinopec, China’s largest refiner, reported approx. 3% decline in refinery throughput, driven by weaker domestic consumption and declining margins. Diesel production also fell by over 10%, reflecting reduced industrial and freight activity amid a slowing economy.

China’s independent refiners, particularly in Shandong, have faced operational challenges due to U.S. sanctions on Russian oil, leading to supply shortages and increased feedstock costs. Several refiners have halted operations or undergone indefinite maintenance as new tariff and tax policies further impact profitability.

Outlook for 2025 remains uncertain as global Diesel markets navigate economic slowdowns, trade realignments, and energy transition policies. While U.S. and Brazilian demand could support exports, China’s shifting fuel landscape may reduce long-term Diesel consumption, influencing global supply-demand balances.