Monday, September 21, 2026
Diesel breaks $6.50 as Ukraine hits Moscow refinery, Trump presses for a halt
Diesel's record run finally hit some resistance this morning, selling off hard after weeks of "diesel diesel diesel" headlines — even as Ukraine's largest overnight drone barrage yet slammed another Russian refinery and Washington leaned on Kyiv to stand down.
Spot diesel sits at $5.338/gal with a $117.18/bbl crack, and retail diesel above $6.28 nationally as truckers, farmers and shippers absorb record costs; gasoline is comparatively calm at $3.535 spot and a $41.45 crack. The diesel spike is increasingly geopolitical: Ukrainian strikes on Moscow-area and Ufa refineries, a Saudi pipeline scare, and Strait of Hormuz risk are all colliding with tight US inventories, prompting Trump to publicly urge Zelenskyy to halt refinery strikes and Congress to pass new Russia-oil tariff authority. On the policy side, California signed its E15 cleanup bill and SAF investment continues apace (Infinium's mSAF platform, OMV Petrom's Petrobrazi project, UK mandate volumes doubling) even as airlines push back on SAF mandate costs.
Change vs. prior data point. Spot prices & single-product cracks vs WTI, from EIA data ↗
📈 Markets & Prices
Diesel Pullback Tests Market Nerves Amid Supply Risks
Diesel prices are selling off sharply this morning after breaking record highs over the past week, even as the market remains fixated on supply risk.
Diesel — the fuel the U.S. economy runs on — hits record high
US diesel prices have set fresh records above $6.50/gal, with wide-reaching implications for truckers and consumer prices.
Why Record Diesel Prices Don’t Equal Price Gouging
Record diesel prices reflect refining bottlenecks and tight inventories rather than gouging, even as crude oil itself has fallen.
What goes into diesel prices?
A primer on how crack spreads function as a proxy for refinery margins in driving diesel pricing.
Fuel cost spike hits carrier margins
Rising fuel costs are hitting trucking carrier margins unevenly, with impacts more nuanced than commonly assumed.
‘It's awful’: How tariffs, soaring fuel costs and higher interest rates are squeezing American companies
Tariffs, soaring fuel costs and higher rates are squeezing manufacturers, auto suppliers, retailers and transport firms.
🏭 Refining & Supply Ops
Moscow Refinery Hit in Major Drone Attack by Ukraine
The Moscow Oil Refinery was hit in Ukraine's largest overnight drone barrage this year, coinciding with the final day of Russia's parliamentary elections.
Ukraine Strikes Moscow Oil Refinery – Fragments Resembling Flamingo Missile Found
Fragments resembling a Ukrainian Flamingo missile were reportedly found near the Moscow refinery strike site.
Drones Attack Ufa Industrial Zone Housing an Oil Refinery
Ukrainian drones also struck an industrial zone in Ufa housing an oil refinery.
Trump urges Zelenskyy to halt Russian refinery strikes: report
Trump is urging Zelenskyy to halt refinery strikes, calling Russia's loss of control over its diesel industry "unfortunate."
🏛️ Policy & Credits
House Passes Bill Allowing New Tariffs on Russia Oil Buyers
Congress gave final approval to a bill granting Trump new tariff powers against buyers of Russian petroleum products.
US sanctions bill targets Russian energy but gives Trump broad discretion
A new US sanctions law targets Russian energy exports broadly but leaves Trump wide discretion to waive provisions.
RFA Celebrates Gov. Newsom’s Signing of California E15 Bill
RFA praised California Gov. Newsom's signing of the E15 Clean-up Act (SB 795) into law.
Airlines seek rethink of SAF mandate amid fears of higher fares
Airlines are pushing to rethink the UK SAF mandate, warning the HEFA cap could add roughly £2 billion a year to fuel costs by 2030.
📊 New Investor Materials
Kroger (KR)
10-Q (filed 2026-09-18) ↗## Fuel-Segment Takeaways
- **Fuel sales surged on price, not volume**: Supermarket fuel sales rose 25.6% in Q2 2026 ($4,105M vs. $3,269M) and 23.1% for the first two quarters ($9,367M vs. $7,609M), driven almost entirely by average retail fuel price increases of 25.3% (Q2) and 23.9% (YTD) rather than gallon growth.
- **Fuel remains a drag on margin mix**: Management explicitly notes fuel sales "have a very low FIFO gross margin rate" and "very low OG&A rate" compared to non-fuel sales — increased fuel sales mechanically lowered both consolidated gross margin (22.4% vs. 22.5% Q2) and OG&A rate (17.2% vs. 17.6% Q2), a mix effect rather than a fuel-margin deterioration signal.
- **Fuel contributed positively to operating profit**: Increased fuel operating profit was cited as a factor boosting operating profit as % of sales for the first two quarters of 2026 (+18 bps), and higher fuel earnings helped drive YTD adjusted EPS growth (+6%).
- **Identical sales metrics exclude fuel**: All core identical-sales reporting (0.2% Q2, 0.6% YTD) strips out fuel entirely, reflecting continued volatility/distortion from fuel pricing in comparable-sales analysis.
- **No station-count or fuel-center-specific disclosures**: The filing provides no data on number of fuel centers, fuel gallons sold, or membership/loyalty-linked fuel discount dynamics (e.g., fuel points redemption trends).
**Signal for fuels markets**: Kroger's results reflect fuel retail price inflation (~24-25% YoY) flowing through to a major U.S. supermarket fuel retailer's topline, with fuel-related earnings functioning as a modest tailwind to profitability even as fuel's inherently thin margins dilute blended retailer profitability ratios.