China has suspended exports of refined oil products for October in an effort to bolster domestic fuel supplies, according to people familiar with the matter. The decision, coinciding with a week-long national holiday that ended this week, involved regulators withholding approval for any October shipments, with the exception of exports to Hong Kong and Macau. It remains uncertain whether export permits will resume following the holiday period.
This move adds pressure to an already tight global fuel market, where diesel, petrol, and jet fuel prices have been surging amid ongoing geopolitical tensions. Conflicts in the Middle East and the prolonged war between Russia and Ukraine have disrupted oil supplies and reduced refining capacity worldwide, contributing to rising costs. In response to these shortages, the Group of Seven nations recently agreed to release 100 million barrels of diesel and crude oil to the market. Additionally, the United States has permitted truckers to use tax-exempt diesel traditionally reserved for farmers to help ease record-high fuel prices.
China’s export pause comes shortly after U.S. President Donald Trump called on Chinese President Xi Jinping to increase refined petroleum production to stabilize global supply during their recent Washington summit. Earlier this year, China had previously suspended refined fuel exports from March to July following joint U.S. and Israeli strikes on Iranian targets. Meanwhile, Russia has extended its ban on diesel exports through October amid damage to its refining facilities from Ukrainian drone and missile attacks, which Ukraine claims have damaged more than 45 percent of Russia’s refining capacity.
The U.S. Energy Information Administration projects that global diesel shortages could persist into next year as damaged refineries remain offline and refining capacity takes months or years to fully recover. Despite crude oil prices having moderated from their earlier peaks—Brent crude is currently trading around $100 per barrel, down from over $126 in April—the impacts on fuel prices remain acute. Diesel prices have hit record highs globally: in the United States, diesel reached $6.53 per gallon last month, nearly double the price at the start of 2026, and even higher in states like California due to taxes and regulatory measures.
China has also seen diesel prices increase significantly, with the guide price rising to 9,655 yuan per tonne in Beijing from 7,450 yuan in January, despite government efforts to control prices through strategic reserves and export limitations. Domestic diesel production in China declined by 8.5 percent in the first eight months of the year, outpacing a 6.8 percent drop in petrol production.
The supply constraints affect more than just vehicle owners at the pump, given diesel’s critical role in powering trucks and agricultural machinery. Shortages and price surges threaten to disrupt farming operations in key producing regions such as Brazil’s Rio Grande do Sul state, where farmers have warned of potential planting delays due to limited diesel availability. Rising diesel costs are contributing to concerns about reduced harvests and increased food prices globally.
Efforts to compensate for supply shortfalls include increased crude purchases by Chinese independent refiners from Iraq and Qatar, replacing previously cheap Iranian supplies. Meanwhile, China continues to invest heavily in renewable energy and electric vehicle development while maintaining substantial coal power production. This strategic diversification has seen a decline in crude oil imports over the past two years despite economic growth. Nonetheless, diesel remains vital to China’s transportation and industrial sectors, with about 60 percent of new trucks sold last year running on the fuel.
Market analysts warn that if conflicts in the Middle East and Eastern Europe persist, diesel prices could climb further, amplifying inflationary pressures worldwide, particularly affecting farmers, transport operators, and ultimately consumers. Saudi Aramco CEO Amin Nasser highlighted global oil stockpiles as “scarily thin,” underscoring ongoing supply vulnerabilities amid the complex geopolitical landscape.