Gasoline and diesel prices have reached new highs due to a combination of record low seasonal stockpiles, limited refining capacity, surging crude oil costs, Russian oil sanctions, and rising demand.
Due to rising refining prices and green energy transition legislation, many refineries in the United States, Canada, Russia, and Europe that transform crude oil into fuels have either scaled back operations or retired completely, reducing global oil processing capacity.
The proposed embargo on Russian petroleum products might exacerbate the present diesel and gasoline shortages in the United States and Europe as the summer driving season approaches.
The rising price of refined petroleum products is posing a threat to the post-pandemic economic recovery, putting pressure on global supply networks, and pushing inflation to 40-year highs.
The fast spike in gasoline prices has surprised car users, but the price of diesel has increased even more, leaving major productive and economically vital sectors subject to cost shocks.
Diesel engines power more than two-thirds of industrial, transportation, agricultural, and construction equipment, and any price increase adds to the economy's inflationary pressures.
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