U.S. President Donald Trump’s effort to broker an energy infrastructure truce between Russia and Ukraine could remove one immediate threat to global fuel markets, but it is unlikely to resolve the diesel shortage that has developed this year.
Trump said Russia and Ukraine had agreed to stop attacking each other’s energy infrastructure. Ukraine, however, has sought further details before committing to halt its own strikes.
The uncertainty matters because the global diesel market is facing disruptions on multiple fronts. Ukrainian attacks have damaged Russian refining capacity, while the war involving Iran has disrupted Middle Eastern refineries and fuel exports.
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Together, Russia and the Gulf previously accounted for almost 45% of global seaborne diesel trade. Their combined net diesel exports in August were around 1.6 million barrels per day lower than in February.
Diesel is particularly important because it powers much of the global transport and industrial economy, including trucks, trains, ships, mining equipment, agricultural machinery and industrial facilities. The supply disruptions have therefore pushed diesel prices and refining margins sharply higher.
Why it matters
The key issue is that the current crisis is increasingly about refining capacity rather than crude oil supply alone.
Even if the Ukraine Russia truce prevents further attacks on Russian energy facilities, it does not immediately restore the refineries that have already been damaged.
That distinction is critical for consumers and businesses. More crude oil entering the market cannot fully compensate for a shortage of functioning refineries capable of converting that crude into diesel.
As a result, the global fuel market could remain tight even if geopolitical tensions begin to ease.
Russia’s refining problem
Russia’s refining industry has been particularly affected by Ukrainian drone attacks.
Refinery crude processing fell sharply in the first half of the year, while gasoline production also declined and contributed to shortages inside Russia. Moscow has responded with restrictions on fuel exports, including a ban on diesel exports that has further reduced supplies available to international markets.
Russia was previously one of the world’s largest diesel exporters. Its reduced participation in the global market has therefore had an outsized effect on international prices.
A sustained halt to Ukrainian attacks could eventually allow Russian refineries to recover, but the damage already inflicted means that recovery will take time.
Why a truce cannot immediately restore supply
The biggest obstacle is the nature of the damage.
Repeated strikes have reportedly targeted critical refinery components, including crude distillation units and hydrocrackers. These are not easily replaced or repaired.
Western sanctions also complicate Russia’s ability to obtain specialised equipment and technology. Refiners may have to compete for scarce engineering expertise and replacement components, particularly while refineries in the Middle East are also dealing with damage.
That means a successful truce could prevent the situation from deteriorating further without immediately reversing it.
Even under favourable conditions, major refinery repairs could take months. A meaningful recovery in Russian diesel exports may therefore not occur until next year.
The Middle East adds another layer of risk
Russia is only one part of the problem.
The conflict involving Iran has damaged refineries and severely disrupted fuel shipments through the Strait of Hormuz, one of the world’s most important energy routes.
The Gulf accounted for roughly one fifth of global seaborne diesel exports in 2025. Any prolonged disruption therefore has consequences far beyond the Middle East.
The gradual recovery of flows through Hormuz can ease some pressure, but it cannot fully compensate for damaged refining capacity.
More importantly, Middle Eastern refineries remain vulnerable if the conflict escalates again.
A persistent global shortfall
Global refining throughput reached a seasonal peak in August, supported by strong U.S. refinery utilisation. Yet total global throughput remained significantly below the previous year’s level.
This suggests that the diesel crisis is becoming structural rather than purely temporary.
The world can increase crude production relatively quickly compared with the time required to rebuild a damaged refinery. Refining facilities are complex industrial systems, and their most important components can take months to manufacture, transport and install.
That creates a lag between the end of a conflict related disruption and the return of normal fuel supplies.
Implications and analysis
Trump’s energy truce could still be important because preventing additional refinery damage is the first step toward stabilising the market. But it should not be mistaken for an immediate solution.
The global diesel shortage reflects accumulated damage across several major refining centres. Even if Russian and Middle Eastern facilities stop coming under attack, existing damage will continue to constrain production.
This could keep diesel prices elevated well into next year, placing additional pressure on transport costs, agriculture, manufacturing and inflation.
For Trump, the issue is also politically sensitive. Higher fuel prices can feed directly into household expenses and business costs, making energy markets an important part of the broader inflation debate.
The bigger lesson is that energy security depends not only on access to crude oil but also on the physical capacity to process it. The current crisis demonstrates how quickly attacks on a relatively small number of strategically important refineries can affect fuel markets worldwide.
A successful Ukraine Russia energy truce could stop the problem from getting worse. It cannot quickly repair the global refining system that has already been damaged.
With information from Reuters.
