Goldman Sachs more than doubles diesel margin forecast

Goldman Sachs The Goldman Sachs Group, Inc. ↗ 0.19% has more than doubled its 2027 diesel refining margin forecasts, warning that war-driven refinery outages and export bans will keep global fuel markets under strain well into next year.

In a note dated August 28, the bank's commodity analysts projected that the profit from producing a barrel of diesel relative to Brent will average $63 in the United States and $49 in the European Union in 2027, up from prior forecasts of $27 and $19, respectively. Refinery outages are currently running 60% above seasonal norms, while product inventories continue to fall despite some weakening in demand, the analysts wrote.oilprice+1

A Market Split in Two

The revised forecast reflects a global fuel market increasingly decoupled from crude oil. While crude exports from the Persian Gulf have recovered to an estimated 70–80% of pre-war levels, refined product shipments remain at roughly 40%, Goldman analysts said. TotalEnergies ↘ 0.14% CEO Patrick Pouyanné illustrated the divide at an energy conference in Stavanger, Norway, last week, saying crude oil was moving "very quietly" through the Strait of Hormuz at a premium, but refined products were not being shipped out.unn+3

Shell ↘ 0.76% CEO Wael Sawan, speaking at the same conference, described a "triple threat" squeezing refined fuel markets: strikes on Russian refining facilities, persistent dangers to shipping in the Persian Gulf, and disruptions in the Red Sea.ndtvprofit+1

Russia and Middle East Compound the Squeeze

Russia extended its diesel export ban through at least September 30, as domestic fuel shortages persist following repeated Ukrainian drone attacks on refining infrastructure, according to Reuters. Moscow has also banned motor gasoline exports until January 2027 and jet fuel exports through November. In the Middle East, dozens of refineries and energy facilities have suffered damage during the U.S.-Israeli military campaign against Iran, which began escalating in early 2026.energynow+1

In Europe, the situation is further complicated by refinery closures driven by EU climate regulations that anticipated demand destruction yet to materialize. In the United States, the diesel crack spread hit triple digits for the first time earlier this month. The International Energy Agency noted in its August report that Atlantic Basin refining margins reached all-time highs in July.iea+1

Goldman analyst Yulia Zhestkova Grigsby argued that geopolitical disruption has collided with a refining system already operating with too little spare capacity. "A full recovery in demand requires global geopolitical de-escalation," the bank's analysts wrote.thedarksideoftheboom.substack+1