Middle distillate tightness from Russia’s diesel export ban and US SPR limits offsets easing geopolitical risks in oil markets.
Oil prices retreated as ICE Brent fell below $90 per barrel, despite persistent US-Iran tensions. Increased tanker flows through the Strait of Hormuz and pipeline diversions eased supply concerns, though geopolitical risks remain elevated.
The US has ruled out further releases from its Strategic Petroleum Reserve after the current 172 million barrel drawdown, leaving stocks near 308 million barrels. Russia’s extension of its diesel export ban until September tightens middle distillate markets, supporting prices amid broader weakness.
Analysts noted that Persian Gulf oil flows reached 13 million barrels per day, with roughly half bypassing the Strait of Hormuz via pipelines. The supply dynamics highlight ongoing tightness in diesel markets despite softer crude benchmarks.