Global diesel refining margins hit a record; US diesel tops $5 a gallon again

As Strait of Hormuz traffic slowed to a near halt during the Iran-US war, a shortage of refined products has pushed the global market toward a fuel crisis and lifted refiners' margins to record highs. According to CNN Business, the refining-margin gauge known as the 3-2-1 crack spread rose to about $70 a barrel on Thursday, July 16, 2026, a record, while US diesel topped $5 a gallon the same day for the first time in three weeks.

The key point is that most of the jump in product prices came not from crude itself (which rose about 5 percent over the period) but from tight refining capacity and disrupted product flows through the Strait of Hormuz. Brent traded in a range of $85 to $88 a barrel during the week.

For Iran the significance is twofold: Iran is itself an importer of gasoline and diesel, so war damage to refineries and costlier products make domestic supply harder, while the global product price also shapes fuel export and smuggling dynamics.