Diesel cargoes are costing more than jet fuel in Europe for the first time in more than a year, LSEG data showed, as the continent replaces lower Middle East air fuel shipments with other sources of supply, but struggles to secure more diesel for industry and agriculture.
Europe has been able to pull in jet cargoes from the US and other countries like Nigeria as prices surged after the start of the Iran war, which disrupted crude and fuel supply. Global diesel supply tightened even further when Russia banned exports amid Ukrainian attacks on its refineries.
"We see a higher risk of persistent scarcity pricing in diesel than in crude heading into winter," analysts at Goldman Sachs said in a note.
Europe boosted imports of jet fuel to 750,000 barrels per day in June — the highest since October 2025 — and a similar rate in July from 612,000 bpd in January, according to Kpler.
By contrast, European diesel imports have dropped to 1.56 million bpd in July from 1.97 million bpd in January. Against that backdrop, the price of diesel overtook that of jet fuel this week, LSEG data showed.
Diesel prices have resumed their rally in recent weeks amid an impasse in Iran peace talks and Russian export disruptions, and are now only 14% below their April peaks. Jet fuel prices, which have also risen in recent weeks, are meanwhile 25% below their March records.
"A brief period of cautious optimism for refined product markets has been quickly overtaken by renewed hostilities in the Strait of Hormuz, the collapse of Russian product supply and a diesel exports ban," said Karim Fawaz of S&P Global Energy.
WEAKENING JET DEMAND LIKELY WEIGHS ON PRICES, ANALYST SAYS
In a further sign of jet's relative weakness, it has dropped against the price of gasoil futures - the benchmark against which it is priced in Europe.
The price assessment of a jet cargo coming into Europe
This is the widest discount since July 2025, according to LSEG and Argus Media. At the height of the Iran war in March, LSEG and Argus assessed jet's premium at more than $500 a barrel. Weakening jet demand after the summer travel seasonal high and the expectation of higher European imports are likely weighing on prices, said Jay Maroo, analyst at Sparta Commodities.
