Supply Chain Optimization

Why is Diesel so Expensive?

by Tom Moore on Oct 11, 2023 10:07:00 AM

US crude is lighter than, say, Nigerian oil, so it is hard to make diesel in quantity. 
Add to that the issues with crude oil itself, which has gone above $90 only to fall into the $70 range, but recent events have sent it to $85.  These events include:
  • Israeli conflict is a spark in the Middle East's powder keg.  Will Israel bomb Iran?
  • The US Government may take a tougher line with Iran and the oil embargo
  • Crude inventories worldwide are low and falling (Demand exceeds supply—see graph below).
  • Saudi leaders say they will release more oil next year if the US provides security guarantees.
  • Slowing world economies will need less oil.
 PastedGraphic-2 (9)
In short, there are a lot of factors at work, and oil traders, like the rest of us, are uncertain.
 
 
Topics: #blog

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