South Korean refiners poised to fill gap as Russia bans diesel exports

Russia temporarily halted diesel exports until the end of July after repeated Ukrainian drone attacks disrupted its refining capacity, tightening global diesel supplies and pushing prices up 13‑14% to over $1,040 per tonne. The ban has widened U.S. diesel crack spreads to more than $80 a barrel.

South Korea, the world’s fifth‑largest refining nation with about 3.2 million barrels per day of capacity, is positioned to mitigate the shortfall. Korean refiners exported a combined 188 million barrels of petroleum products in the first five months of the year, with diesel accounting for roughly 40.6% of those exports. Analysts say their sophisticated, export‑oriented refineries can quickly increase diesel shipments to Asia and other markets, supporting refining margins. Shares of major refiners rose sharply, with SK Innovation up 7.09% and S‑Oil up 5.6%.

Market participants also see the supply shock as a factor that could push crude oil toward new all‑time highs later in the year.