Since the outbreak of the Iran conflict in February 2026, the Strait of Hormuz, through which roughly a fifth of the world’s petroleum supply transits, has faced sustained disruptions. Diesel is now trading above $200 per barrel in both the United States and Europe, representing a 55% to 78% increase from pre-war levels. Refining margins, or crack spreads, have exceeded $100 per barrel for the first time in recorded history. American consumers have spent approximately $100.9 billion more than they would have at pre-war prices, with diesel alone accounting for roughly $46 billion. Global distillate supply remains under pressure from two fronts: the loss of 770,000 barrels per day from the Middle East and Russian restrictions representing 350,000 barrels per day, keeping global inventories at dangerously low levels.
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