Trump's proposed diesel export ban would hit Aussie fuel prices - experts (news.com.au)

Description

Interviewed on the implications for Australia of a proposed United States diesel export ban. Distinguished between supply and price exposure, arguing that Australian barrels are refined in Asia and that supply should hold so long as South Korea, Singapore, India and Japan continue receiving heavy crude — with the effect falling instead on price, since US diesel normally moves to Latin America and Europe and blocking it would redirect those buyers east to compete for the same Asian barrels Australia relies on. Noted that because Australia prices off Singapore gas oil, the effect reaches Australian pumps without any US cargo changing hands.

Assessed current price pressure as originating in reduced Middle East and Russian supply rather than US export policy, with diesel exports from those sources down 75 per cent since the outbreak of the Iran war. Identified the more consequential consequence of a ban as the closing of an emergency option: characterised the earlier US cargoes as exceptional rather than structural, economic only because Asian crack spreads were extreme — precisely the conditions under which Washington would be most inclined to restrict exports.

Subject

Proposed US diesel export ban, Singapore gas oil pricing transmission and the loss of emergency supply options for Australia.