Europe has been closing refineries for 10 years. Now even a fire in Nigeria raises the price of diesel
Diesel prices in Europe have once again set off alarm bells. In a matter of days, the market has experienced a sharp rebound that cannot be interpreted as a one-off shock, but rather as the symptom of a fragile energy system that, in the face of a global chain of incidents, has left the continent without defenses. A chain of critical interruptions. The immediate origin is in a succession of stoppages in refineries and international tensions. According to the Financial TimesEuropean operators reacted with concern after several facilities in Kuwait, the United States and Nigeria were forced to stop or reduce production due to fires or technical problems. These interruptions coincided with already very low inventories and with demand that remains stronger than expected. Adding to this instability was the announcement that United States sanctions against the two largest Russian producers, Lukoil and Rosneft, will come into effect immediately. As the British media explains, these measures will block any operation related to the international assets of both companies, including refineries that still indirectly supply the European market. Only the Bulgarian Lukoil refinery has received a temporary exemption until 2026. The scenario is even more complicated with the fall of Russian crude oil. According to Bloombergits price has fallen to the lowest level in more than two years, just when large Asian buyers have paused purchases due to the entry into force of sanctions. In addition, the EU has also sanctioned Russian refined products that arrive re-exported from India or Türkiye, a flow that had served as an indirect way to compensate for the lack of European diesel. An extremely vulnerable market. Europe has lost refining capacity over the last decade. According to data cited by the Financial Timesthe continent has closed about 400,000 barrels per day since 2024. This reduction means that it is increasingly dependent on imported fuels and a global market that has become more volatile and unpredictable. The European industrial crisis amplifies this problem. Based on data from the petrochemical industry, high energy costs and Asian competition have caused massive closures of plants in the Netherlands, Germany and the United Kingdom. This industrial deterioration also affects the infrastructure linked to fuel processing. For analyst Benedict Georgethe result is clear: “European prices are much more sensitive to any disruption because Europe has closed many refineries in recent years.” A tense world. Although the price of diesel has skyrocketed, the global crude oil market presents a paradox. The International Energy Agency foresees a record surplus in 2026powered by the increase in OPEC+ production and for the rebirth of the American offshore. However, this future abundance is not alleviating current tension. As Bloomberg points outthe market remains trapped between sanctions, fears of specific shortages and sudden changes in global flows. Added to this is a particularly delicate geopolitical context for Europe. The peace plan proposed by the United States for Ukraine has generated a “diplomatic storm” in Brussels and kyiv for their apparent alignment with pro-Moscow positions. This diplomatic uncertainty – which affects sanctions, energy and continental security – adds pressure to an EU that already depends on abroad to guarantee its diesel supply after two years of war. A direct hit. Europe faces a structural problem: it has little of its own refining capacity, low inventories and a growing dependence on imports. Every global incident reaches the European consumer almost unmuffled. And this directly affects Spain for three reasons: Spanish transport depends mainly on diesel. Trucks, logistics vans, buses and much of rural transport continue to use diesel. The escalation is transferred to the prices of goods. Food, imported products, construction materials… Everything that moves by road becomes more expensive when diesel does. Price spikes are amplified. Being a net importer, Spain especially suffers from international volatility. The rapidity with which diesel has risen shows that Europe “has no margin”: each shock becomes a direct blow for consumers and companies. For a standard 55 liter tank, filling a diesel car is already around 79 euros, while with 95 gasoline the cost is close to 82 euros, according to current average prices. Is there relief in sight? In the short term, analysts cited by Financial Times They believe the rebound could moderate during the winter months, when refineries avoid scheduled shutdowns to maximize production. But they warn that the market will remain “vulnerable to any disruption.” In the medium term, the perspective is contradictory. On the one hand, the International Energy Agency anticipates a global surplus in 2026 and an increase in production in both the United States and OPEC+. On the other hand, Chinawhich has purchased more than 150 million barrels for reserves— could stop its acquisitions at any time, releasing an excess capable of sinking global prices or further tightening the chains if it decides to continue accumulating. The warning of a weak system. Europe faces uncomfortable evidence: it has built a fragile energy system at a time of maximum global tension. The combination of refinery shutdowns, sanctions on Russia, diplomatic tensions and loss of industrial capacity has left the continent exposed. As the London media summarizes, “inventories are extremely low and demand is better than expected.” An explosive mixture. While the world navigates between a future surplus and constant geopolitical crises, the present shows that any spark – a fire, a sanction or a diplomatic disagreement – can reignite the European diesel market. And Europe, for now, appears to have few tools to prevent the next shock from hitting even harder. Image | FreePik Xataka | The world is heading towards an oil surplus: the US responds by filling the Gulf of Mexico with platforms again
