Diesel Is Nearing All-Time Highs
National diesel prices were nearly $5.70 a gallon, just a dime from the all-time high reached in 2022 at the start of the Ukraine War. Crude oil prices have moved back into the low $90 range for WTI and nearly $95 a barrel for Brent. Given maintenance schedules and the refinery industry operating at full speed, the risk of a supply disruption is rising. The U.S. is also a critical link in supplying diesel for export to parts of the world, where Russian diesel has been choked off.
With the latest developments in the Middle East, it appears that conditions will remain elevated for longer heading into the fall. Producers know that keeping prices this high for too long will lead to demand destruction and rough economic conditions.
Keep an Eye on That Canary in the Coal Mine
The global bond market has been a hot topic as of late.
U.S. Treasury Rates (which set the floor for most borrowing rates) have been rising sharply. The 10-year U.S. Treasury reached 4.78%, nearly its highest level since the start of the Ukraine War in 2022. The 30-year U.S. Treasury is approaching levels not seen since 2001.
And the U.S. is not alone. Japan just saw its sovereign debt reach 30-year highs; the UK touched 18-year highs; France reached 18-year highs; and Germany was the “best in the group” at 15-year highs.
Many try to shrug this off as a sign that the economy is strong and that traders are moving into riskier assets. Everyone is trying to determine what’s over the horizon.
Read more about how this, along with financial developments and other global issues, could affect your supply chain.
