WTI Holds Near $84 as Record Diesel Crack Signals Market Tightness

Oil prices edged higher Wednesday, with West Texas Intermediate (WTI) crude settling at $84.25 per barrel, a gain of 0.23 percent. The global benchmark Brent crude rose to $91.46. The price for Bakken crude at the Clearbrook, Minnesota, hub traded at a discount of $3.42 per barrel versus WTI.

The modest move in crude futures belied significant tightness in the refined products market, particularly for diesel. According to a report from OilPrice.com, the diesel crack spread in the United States hit a record high this week, reaching triple digits for the first time ever. The premium for diesel over crude jumped to as high as $102 per barrel on Monday before easing to about $100.

This record diesel crack signals a much tighter physical oil market than current crude futures suggest, the report stated. The shortage is driven by severe supply disruptions. Diesel and gasoil exports from the Middle East and Russia have crashed by more than 50% in recent weeks to just 1.6 million barrels per day from about 3.3 million, according to data from analytics firm Vortexa cited in the report.

The disruptions stem from the war in Iran, which has drastically reduced tanker traffic through the Strait of Hormuz, and Russia's ban on diesel exports following Ukrainian drone attacks on its refineries. With Chinese fuel exports also yet to meaningfully rebound, global middle distillate inventories are falling. In the United States, inventories are now 12% below the five-year average for this time of year.

"Refinery margins globally are near record levels, driven largely by a severe and worsening diesel shortage," Vortexa senior oil market analyst Rohit Rathod said this week. U.S. and European refineries are running near capacity to offset lost supply, delaying planned maintenance. The average U.S. diesel price has soared to $5.47 per gallon, up 8% in a month and over 40% higher than the year-ago average.

For Bakken operators, the wide diesel crack provides a supportive backdrop for crude prices, even as the local differential remains negative. High refining margins incentivize strong refinery runs, supporting demand for crude feedstock like Bakken light sweet oil. However, the physical market tightness for products also increases volatility risk, with the market "one hurricane or one unexpected stoppage away from new record highs," the OilPrice.com report noted.

In natural gas, prices were flat Wednesday at $2.78 per million British thermal units (MMBtu). In a separate report, Rigzone noted the U.S. Energy Information Administration (EIA) has lowered its Henry Hub spot price forecast, now seeing an average of $3.44 per MMBtu for 2026. This continued pressure on gas prices remains a headwind for Bakken producers, who often produce associated gas alongside crude.