Indeed, the head of the world’s largest independent oil trader has warned of a “systemic” shortage of diesel in Europe. And by ‘Europe’ we do mean the UK as well.

The FT reports – Global markets face a squeeze on diesel, leading traders have warned, with Europe most at risk of a “systemic” shortage that could lead to fuel rationing.

“The thing that everybody’s concerned about will be diesel supplies. Europe imports about half of its diesel from Russia and about half of its diesel from the Middle East,” said Russell Hardy, chief of Switzerland-based oil trader Vitol. “That systemic shortfall of diesel is there.”

Hardy added that refineries could boost their diesel output in response to higher prices at the expense of other oil-derived products to shore up supply, but acknowledged that rationing was a possibility. Torbjorn Tornqvist, co-founder and chair of Geneva-headquartered Gunvor Group, added: “Diesel is not just a European problem; this is a global problem. It really is.” Tornqvist also said European gas markets were no longer functioning properly as traders faced huge demands from banks for cash to cover hedging positions.

Reuters’ John Kemp reported this week that diesel fuel stocks in Europe are at their lowest since 2008 – or the equivalent to 35 million barrels, much lower than the five-year average for this time of the year.

What is perhaps worse, however, is that over the past 12 months, the combined diesel fuel inventories in the U.S., Europe, and Singapore, have shed a combined 110 million barrels that have yet to be replaced, Kemp noted.

On top of all this, Russia is a major supplier of diesel, meaning Western sanctions for its invasion of Ukraine are affecting these supplies too. With the market increasingly tight, Shell and BP have shied away from offering any diesel fuel cargos on the German market for two weeks – for fear of shortages.

The result of this is that analysts in the UK market are warning that the government may need to resort to diesel fuel rationing from next month.

Back in February, Morgan Stanley recalled a situation in 2008, when diesel fuel prices reached $180 per barrel, while crude oil was flirting with $140. And there wasn’t a war in 2008.

“A repeat of that is not our base case, but it is notable that diesel prices have been tracking the 2007-08 period closely in recent months,” the bank’s analysts said, as quoted by Reuters’