U.S. Diesel Futures Jump 4.5% as Crude Oil Closes Mixed Amid Supply Tightness

U.S. ultra-low sulfur diesel futures surged on Tuesday, climbing 4.5% to settle at $4.9344 per gallon, marking its highest close since late September. Meanwhile, crude oil markets ended mixed as November Nymex crude rose 0.4% to $94.14 per barrel and December Brent crude fell 0.9% to $105.69 per barrel. Gasoline futures slipped 1.2% to $3.2501 per gallon, while natural gas futures gained 3.6% to settle at $3.283 per MMBtu.

Fuel markets remain tight despite recent policy moves, including the lifting of U.S. sanctions on Russian diesel and a tax break for on-road use of dyed diesel. Trucking companies generally lack access to dyed diesel or avoid using it because of recordkeeping requirements. Escalating conflict in the Middle East continues to impact energy infrastructure and ocean logistics. Recent strikes targeted the headquarters of Saudi Aramco (ARMCO) and the Riyadh airport, while oil shipping through the Strait of Hormuz dropped sharply to 2 million barrels per day over the weekend following increased attacks on tankers.

Investors are now weighing ongoing Middle East disruptions against shifting demand projections. OPEC lowered its 2026 global oil demand growth forecast for a sixth consecutive month to 180,000 barrels per day, down from 380,000 barrels per day. However, the organization raised its demand growth forecast for next year to 2.55 million barrels per day, citing the need to rebuild inventories depleted during the war in Iran. Market participants will watch whether geopolitical developments and energy infrastructure strikes keep refined product supplies constrained.