Surging Diesel Demand Is Underpinning Crude Oil&rsquo s Bull Market

• Market structure for the fuel has turned strongest in years
• Tightness may continue as stockpiles slip in key regions
   
  
  With industrial activity surging worldwide, the fuel -- known in the industry as ultra-low sulfur diesel or ULSD -- is enjoying strong demand, accelerating total oil consumption growth in 2017 well above the 10-year average.

   

  
  
  And just as demand rose faster than expected, diesel supply was hit, prompting a rapid tightening. First in Europe: the Pernis refinery, owned by Royal Dutch Shell Plc and considered one of the region&rsquo s diesel machines, suffered a fire in July and shut down for several weeks. And then in the U.S., where hurricane Harvey in late August temporarily knocked out a dozen refineries, disrupting both domestic supplies and distant export markets.

   

  
  
  &ldquo The oil market is currently driven by four letters: It&rsquo s ULSD, not OPEC,&rdquo said Olivier Jakob, managing director of consultant Petromatrix GmbH.

   

  
  
  The combination of strong demand and refinery outages has drained global diesel stocks over the summer, a rare occurrence as inventories usually build from July to September in preparation for a seasonal uptick in demand with the onset of the northern hemisphere winter. A cold spell later this year or in early 2018 could tighten the market even more, triggering another price spike.

Major Iranian oil company says oil at $60 a barrel could stabilize the energy market

• Oil prices near $60 a barrel could stabilize the energy market, a senior executive at a major Iranian state-owned oil company said
• Saeid Khoshrou, director of international affairs at the National Iranian Oil Company, said low prices gave investors the wrong impression
• Khoshrou said the ratio between Iran' s reserves and production capacity indicate it is a great investment destination.

US crude surges 3% to settle at $52.22, best closing price in five months

US crude oil tops $51 for first time in four months as producers say market is rebalancing

• Iran to keep oil exports at around 2.6 million barrels per day
• Major producers confirm global inventories falling
• Russia seeks cooperation beyond end of next March