Diesel supplies in Europe will remain tight as the continent looks to reduce its reliance on Russian imports, Rystad Energy said in a research note on Saturday.
Europe is in a race to secure more diesel shipments before an EU ban on oil product imports from Russia, its biggest supplier, comes into effect on February 5.
Faced with limited options, European traders have boosted their imports of Russian diesel before the embargo.
“When it comes to diesel, the EU is caught between a rock and a hard place,” said Mukesh Sahdev, senior vice president at Rystad Energy.
“There does not seem to be enough to meet current or future demand.”
After dropping to a low of 450,000 barrels per day in September, Europe’s diesel imports from Russia have risen to an average of 600,000 bpd over the last two months, data from Rystad Energy showed.
Meanwhile, imports from other markets such as the Middle East and Asia have doubled to 1.2 million bpd in October, from January levels, the Norway-based consultancy said.
The International Energy Agency (IEA) has said that “persistently high” diesel prices and a slowing economy could result in demand for diesel and gas oil falling to 400,000 bpd in 2022, from 1.5 million bpd last year, before declining slightly in 2023.
Diesel is the backbone of global economic activity and markets were already in a deficit before Russia’s invasion of Ukraine began in February.
This was due to the closure of 3.5 million bpd of refinery distillation capacity since the start of the Covid-19 pandemic, resulting in a net decline of 1 million bpd, the Paris-based agency said in a report this month.
Although diesel prices have dropped from their June peaks, average prices are still $50 higher than pre-pandemic levels.
“Any change in pricing will come from cuts to demand as a result of high prices, rather than the supply side which will remain tight,” said Mr Sahdev.
“Overall, the high diesel price distortion is going to continue and remains a key driver for inflation across all sectors including energy, transport, food and construction,” he added.
September and October are seasonal months of high diesel demand in Europe followed by a drop, with demand usually picking-up in February again.
With Russian crude exports dwindling and a total ban on product imports only months away, Europe has an “impossible target” to achieve, said Mr Sahdev.
“Europe neither has the refining capacity to make diesel nor it can import to plug the hole that will be created by February 5.”
As of October, EU countries have reduced Russian crude oil imports by 1.1 million bpd to 1.4 million bpd.
When the crude and product embargoes come into full force in December and February, respectively, an additional 1.1 million bpd of crude and 1 million bpd of diesel, naphtha and fuel oil will need to be replaced, according to the IEA.
The Group of Seven advanced economies (G7) is ready to impose a price cap on Russian oil from December 5. The goal is to keep Russian barrels in the market without allowing Moscow to reap the benefits of high prices.
EU diplomats say they need more time before resuming negotiations to cap the price of Russian oil, 24 hours after failing to agree on the $65-$70 a barrel ceiling suggested by the G7.
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Navdeep Suri, India's Ambassador to the UAE
There has been a longstanding need from the Indian community to have a religious premises where they can practise their beliefs. Currently there is a very, very small temple in Bur Dubai and the community has outgrown this. So this will be a major temple and open to all denominations and a place should reflect India’s diversity.
It fits so well into the UAE’s own commitment to tolerance and pluralism and coming in the year of tolerance gives it that extra dimension.
What we will see on April 20 is the foundation ceremony and we expect a pretty broad cross section of the Indian community to be present, both from the UAE and abroad. The Hindu group that is building the temple will have their holiest leader attending – and we expect very senior representation from the leadership of the UAE.
When the designs were taken to the leadership, there were two clear options. There was a New Jersey model with a rectangular structure with the temple recessed inside so it was not too visible from the outside and another was the Neasden temple in London with the spires in its classical shape. And they said: look we said we wanted a temple so it should look like a temple. So this should be a classical style temple in all its glory.
It is beautifully located - 30 minutes outside of Abu Dhabi and barely 45 minutes to Dubai so it serves the needs of both communities.
This is going to be the big temple where I expect people to come from across the country at major festivals and occasions.
It is hugely important – it will take a couple of years to complete given the scale. It is going to be remarkable and will contribute something not just to the landscape in terms of visual architecture but also to the ethos. Here will be a real representation of UAE’s pluralism.
BUNDESLIGA FIXTURES
Saturday, May 16 (kick-offs UAE time)
Borussia Dortmund v Schalke (4.30pm)
RB Leipzig v Freiburg (4.30pm)
Hoffenheim v Hertha Berlin (4.30pm)
Fortuna Dusseldorf v Paderborn (4.30pm)
Augsburg v Wolfsburg (4.30pm)
Eintracht Frankfurt v Borussia Monchengladbach (7.30pm)
Sunday, May 17
Cologne v Mainz (4.30pm),
Union Berlin v Bayern Munich (7pm)
Monday, May 18
Werder Bremen v Bayer Leverkusen (9.30pm)
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
The National Archives, Abu Dhabi
Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.
Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en
Match info
Uefa Champions League Group H
Manchester United v Young Boys, Tuesday, midnight (UAE)
Oppenheimer
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Tearful appearance
Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday.
Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow.
She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.
A spokesman said her upset demeanour was due to a personal matter.
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New Zealand (1st innings) 153 all out (66.3 overs) - Williamson 63, Nicholls 28, Yasir 3-54, Haris 2-11, Abbas 2-13, Hasan 2-38
Pakistan (1st innings) 59-2 (23 overs)
Messi at the Copa America
2007 – lost 3-0 to Brazil in the final
2011 – lost to Uruguay on penalties in the quarter-finals
2015 – lost to Chile on penalties in the final
2016 – lost to Chile on penalties in the final
PROFILE OF SWVL
Started: April 2017
Founders: Mostafa Kandil, Ahmed Sabbah and Mahmoud Nouh
Based: Cairo, Egypt
Sector: transport
Size: 450 employees
Investment: approximately $80 million
Investors include: Dubai’s Beco Capital, US’s Endeavor Catalyst, China’s MSA, Egypt’s Sawari Ventures, Sweden’s Vostok New Ventures, Property Finder CEO Michael Lahyani
Water waste
In the UAE’s arid climate, small shrubs, bushes and flower beds usually require about six litres of water per square metre, daily. That increases to 12 litres per square metre a day for small trees, and 300 litres for palm trees.
Horticulturists suggest the best time for watering is before 8am or after 6pm, when water won't be dried up by the sun.
A global report published by the Water Resources Institute in August, ranked the UAE 10th out of 164 nations where water supplies are most stretched.
The Emirates is the world’s third largest per capita water consumer after the US and Canada.
