Hungarian energy company Mol has announced its support for the Hungarian government’s targeted fuel subsidies over blanket price caps, warning that introducing capped fuel prices under present market conditions would push out imports and trigger fuel shortages within days.
Disruptions across global energy routes
Conflict around the Strait of Hormuz alongside Ukrainian attacks on Russian energy infrastructure has disrupted diesel and kerosene flows from Russia and the Middle East. Meanwhile, European Union sanctions restrict shipments of refined products derived from Russian crude oil, cutting diesel imports into the EU from India and Turkey.
Global diesel exports fell 21 percent in July compared to the beginning of the year, while global gasoline exports dropped 14 percent compared to a year earlier. Freight movements also face regional bottlenecks. Low river water levels have hindered fuel transport into continental Europe ahead of upcoming autumn refinery maintenance across Europe and the United States.
Price pressures and seasonal demand
The supply restrictions coincide with the onset of an annual 60-day peak season for the European gas oil market. High demand approaches just as crude and product pricing registers sharp gains.
By September 8, crude oil prices had climbed 53 percent compared to levels recorded before the outbreak of the war with Iran. European diesel prices rose 89 percent over the same comparison timeframe.
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Source: Mol
