US weighs diesel export ban: India ramps up shipments as Russia supply falters. Can it sustain this?

The US is considering a 90-day ban on diesel exports as the Trump administration faces pressure to bring down fuel prices ahead of the November midterm elections, Politico reported.

The proposal has triggered divisions within the administration and opposition from the US fuel industry, which has warned that restricting exports could offer only temporary relief while tightening supplies and pushing prices higher later, according to the report.

Meanwhile, India has indicated that it has no plans to restrict diesel exports, even as global fuel markets remain tight.

“We honour our commitments,” Oil Minister Hardeep Puri said while referring to existing diesel export contracts, according to Bloomberg.

Puri said India has strengthened its refining capacity and is better positioned to deal with market disruptions.

Why India is exporting more diesel

India has emerged as an increasingly important supplier in the global diesel market.

Kpler data cited by Bloomberg showed that India accounted for about 10% of global diesel shipments so far this year, making it the world's second-largest exporter of seaborne diesel and putting it ahead of Russia.

The trend has been supported by India's large refining base and its ability to redirect fuel towards markets offering better margins.

In July, India's refined-fuel exports reached 1.53 million barrels per day, 27% above the preceding 12-month average and the highest July level since Kpler's records began in 2017, according to Reuters, citing Kpler. Strong diesel margins, Russia's export restrictions and increased refinery runs helped drive the surge.

Who is buying Indian diesel?

India's export destinations have shifted according to regional shortages and price signals.

Brazil: India was on track to send 2.8 million barrels of diesel to Brazil in July, an 11-month high, according to Reuters.

Africa: Asia's diesel exports to Africa, including shipments from India, hit a 4-year high in August 2026 as African buyers sought alternative supplies following disruptions to Middle Eastern exports, Reuters reported.

Southeast Asia: India's diesel exports to Southeast Asia reached a seven-year high in March 2026, driven by higher regional refining profits and supply disruptions linked to the Iran conflict, according to Reuters data.

Turkey: Turkey has also increasingly turned to Indian supplies as Russian supplies were disrupted. Turkey's diesel imports from India rose to a record high of more than 120,000 barrels per day in August 2026, according to Kpler shipping data cited by Reuters.

Europe: Reliance Industries' July shipments to Europe rose as the continent faced depleted inventories and supply disruptions from Russia and the Middle East. European diesel margins reached a record $74 a barrel, while stockpiles fell to their lowest level since 2014, Reuters reported.

Why Russia's diesel ban matters

India's role has become more significant as another major diesel supplier has faced repeated export restrictions.

Russia banned diesel exports for most of July after Ukrainian drone attacks damaged oil refineries and caused domestic fuel shortages.

The disruption removed a major source of diesel from international markets and pushed more buyers towards alternative suppliers.

Historically, Russia, the world's second-largest seaborne diesel exporter, has at times been forced to halt international shipments to protect its domestic market.

The latest Reuters analysis shows that global diesel markets remain under pressure amid disruptions in Russia and the wider West Asia crisis.

Can India sustain higher diesel exports?

India has the refining capacity to remain an important supplier, but maintaining exceptionally high export volumes is not simply a question of having enough crude or refinery capacity.

Reuters reported in July that shipping economics were already shifting. While European demand was strong, Asia was also offering attractive diesel margins.

Shipping a large cargo from India's west coast to Europe can cost more than $5 million, or about $55 a tonne, making the trade viable only when European buyers offer a sufficient premium, according to the report.

This means Indian refiners can redirect cargoes between Europe, Africa and Asia depending on price spreads, freight costs and regional shortages.

There is another constraint: global diesel demand is being met against a backdrop of limited spare refining capacity. Reuters reported that refineries globally are operating at or near full capacity, while diesel inventories remain unusually low.

Analysts cited in the report expect the global shortage to persist into 2027.

So, India can continue supplying diesel to overseas markets, but sustaining unusually high export volumes could become difficult in the long run. The deciding factor is where Indian refiners can make the best returns.

About the Author

Bhanu Pratap is a journalist who reports and writes on foreign affairs, India’s foreign policy, geopolitics and strategic affairs. He closely follows diplomatic developments in New Delhi and has a keen interest in defence and national security.<br> <br> Bhanu also focuses on in-depth, interview-based reports and regularly speaking with experts and policymakers to bring perspectives and context to major developments around the world.<br> <br> He is also interested in stories with strong humanitarian angles.<br><br> One such report examined the cases of Indian nationals who were allegedly recruited and forced into Russia’s war against Ukraine. While reporting the story, Bhanu spoke to the families of those affected and documented their experiences. The report was later taken into account by the United Nations in its findings on human rights violations linked to the war in Ukraine.<br> <br> For Bhanu, the zeal to produce meaningful and impactful journalism remains at the heart of his work.<br> <br>He has previously worked with Firstpost, NDTV, Newslaundry and Republic.<br><br> Bhanu studied at the Delhi School of Journalism, University of Delhi. He initially chose science with plans to pursue engineering, influenced by conventional expectations, but fate had other plans and eventually led him to journalism.<br><br> Beyond the newsroom, Bhanu enjoys exploring culture and history and often spends his days off on heritage walks. He is also passionate about travelling, biking and listening to folk music.<br> <br>For tips, reviews and suggestions, you can reach him at bhanu.pratap@htdigital.in.

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