Insight - Diesel is the US economy’s inflation canary

Distillate fuel oil has become the most cyclically sensitive part of the oil market, closely tracking the expansion and contraction of manufacturing activity and freight flows.

SHORTAGES of diesel and other distillate fuel oils have emerged as a key bottleneck in the oil market and will exert upward pressure on oil and fuel prices until the global economy moves onto a slower growth trajectory.

Distillate fuel oil has become the most cyclically sensitive part of the oil market, closely tracking the expansion and contraction of manufacturing activity and freight flows.