Russia bans diesel exports through end of July, squeezing the global fuel market

Russia imposed a full ban on diesel exports on July 8 to boost supplies to its domestic market. Deputy Prime Minister Alexander Novak announced the decision at a meeting attended by Vladimir Putin. The move follows large-scale Ukrainian drone attacks on Russian refineries that, according to reporting, have knocked out about 25 percent of the country's oil-refining capacity versus a year earlier, causing fuel shortages and rationing (a cap of 20 liters per vehicle) across more than 20 regions.

According to CNN and Intercontinental Exchange (ICE) data, the global benchmark diesel price jumped nearly 13 percent on the day the ban was announced. The Russian government said the ban runs through July 31, with pre-existing committed shipments, including a deal with Mongolia, exempted. The restriction is tightening the fuel market just as global energy traders also brace for deeper disruption in the Strait of Hormuz, two forces that can pressure the prices of oil products relevant to Iran.