Publications: Notes at the Margin

The Diesel Crisis (March 9, 2026)

 

On Saturday, March 7, Iran’s President Masoud Pezeshkian announced that attacks on neighboring countries would end unless Iran was targeted by forces in those nations.[i] He and Iranian officials understand that ending such attacks will not eliminate the current global crisis. The problem will exist as long as shipowners keep their vessels from crossing the Strait of Hormuz. These owners know that groups of Revolutionary Guard equipped with Iranian drones have spread across the country and may independently attack ships trying to transit the Persian Gulf. Neither the Israelis nor the US forces can find them all. The crisis will not stop until Pezeshkian opens the Strait or Iran’s fighting forces are neutralized.

Today, Iran is holding the global energy market hostage just as it held US State Department workers captive in 1979. Back then, President Carter was powerless to resolve the issue. Now, Benjamin Netanyahu and Donald Trump are equally helpless.

Pezeshkian also knows this is a diesel crisis. He probably knows, too, that the abundant supplies of US WTI crude, oil that the US Secretary of the Treasury thinks China should buy to replace Russian supplies, will not produce much diesel. By shutting the Strait, Iran has cut the exports of distillate-rich Middle Eastern crude, jet fuel, and diesel. There is a term for this in chess:

CHECK

 

All crises and all crudes are not the same. We present hard data at the end of the report showing that, after the first week of conflict, those buying and selling oil—from large traders to major oil firms—all view this as the worst disruption since futures markets began trading in the mid-1980s.

 

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