US diesel supplies hit lowest seasonal level ever, raising prices

The US just set a record nobody wanted. Distillate fuel oil inventories, which include diesel and heating oil, dropped to 103.4 million barrels for the week ending August 21, 2026. That’s the lowest seasonal level since the Energy Information Administration began tracking the data in the early 1980s. A drawdown of approximately 2.2 million barrels from the prior week pushed stocks to roughly 14% below the five-year seasonal average. Diesel retail prices are already sitting above $5.60 per gallon, and the timing could not be worse: the months when demand typically surges are right around the corner. Record exports are draining the tank The core problem is straightforward. US refineries are producing diesel, but a huge chunk of it is leaving the country. Recent export volumes peaked near 1.9 million barrels per day, a record high that has been siphoning supply away from domestic reserves at an alarming rate. Geopolitical disruptions affecting global supply routes have made US diesel especially attractive to foreign buyers, adding even more pull on an already strained system. Refining margins have widened in response, which is good news for refiners’ bottom lines but bad news for anyo...