Diesel crack spreads reached new records across Europe this week, topping $90/bl on 29 July, with supply tightness most prevalent in the Mediterranean region, where prices are at the highest premium to northwest Europe in three months.
Diesel cargoes loading from the Amsterdam-Rotterdam-Antwerp (ARA) hub settled at a $85.86/bl premium to benchmark North Sea Dated crude on Thursday, 30 July, up by 16pc on the week. Cracks exceeded the most recent all-time high set earlier in July and have risen by more than 50pc since the start of the month.
The effects of the strait of Hormuz closure and of Russia's diesel export ban, which was extended on Thursday, have been particularly felt in the Mediterranean. Turkey is normally the largest buyer of Russian diesel, but flipped to a net-importer from European countries for the first time since November 2022 this month.
Diesel cargoes delivered into the west Mediterranean settled at a $91.67/bl premium to Dated on Thursday, the second highest on Argus' records after Wednesday's peak of almost $95/bl.
Competition between the Mediterranean and northwest Europe for non-European supply has surged in recent days, according to market participants. The premium for diesel cargoes delivered to the west Mediterranean against cargoes delivered to ARA settled at a three-month high of $33.50/t on Thursday. Only in April this year has that been higher since May 2022.
Disruption to shipping in the Red Sea caused by attacks from the Yemen-based Houthi group this week — including on Saudi state-controlled Aramco facilities in Jizan and Yanbu — could place further strain on European supply, again with the effects felt more in the Mediterranean, traders said. Mediterranean EU countries have relied on Saudi Red Sea ports for 24pc of their diesel imports since April, while northwest European EU countries have only relied on the region for 17pc of their imports.
Only 100,000t of diesel has loaded from Saudi Red Sea ports since 27 July, down from almost 600,000t in the previous week, and no tankers have loaded diesel from Jizan, according to Vortexa.
Competition continues to rise
Buyers in the eastern Mediterranean and the Black Sea are out-competing those in northwest Europe for alternative supply, pulling in "huge volumes", market participants said.
Turkish imports of non-Russian diesel are on track to be above 600,000t in July, which would be the highest since December 2022. This includes a Suezmax cargo from Indian refiner Reliance's 1.4mn b/d Jamnagar plant, according to Vortexa.
Greece's imports have risen to a seven-month high so far in July.
In the Black Sea, Romania has leaned heavily on Saudi Arabian Red Sea supply, importing more than 175,000t in July on two Long Range 2 (LR2) tankers, one each from Yanbu and Jizan. This brought the country's net imports to an eight-month high. Seaborne arrivals into Ukraine have also reached an eight-month high.
Flows from northwest Europe to the Mediterranean have not picked up despite the favourable price spread. Almost 400,000t has loaded on that route so far in July, matching the average of the prior three months. Lower export availability in the Mediterranean may have discouraged the trade, as tankers could have to return empty, a trader said.
US supply patterns have also shifted. More than half of US Gulf Coast supply that has discharged in Europe so far in July did so in the Mediterranean, compared with just 13pc in all of 2025. A record amount of diesel loaded from the US for Europe in the week to 26 July, and loadings have continued at a fast pace this week.
But that is not enough to outweigh the present constraints, market participants said. Independently-held stocks at ARA fell to the third-lowest on consultancy Insights Global's records this week. Lower barge flows from ARA, because of the diminished Rhine River water levels, could have the effect of increasing German demand for cargoes to its Baltic Sea ports, a trader said.
The backwardated structure in Ice gasoil futures — indicative of prompt supply tightness — was the widest in three months on Thursday.
