TotalEnergies SE Chief Executive Patrick Pouyanne said the oil market is sending conflicting signals, with crude futures near $90 per barrel in London while refined product prices surge amid supply disruptions.
Speaking at the ONS conference in Stavanger, Norway, Pouyanne described a "bearish crude oil market and a very bullish product markets," a dynamic he characterized as "very strange." The divergence reflects constrained refined fuel flows through the Strait of Hormuz, where higher shipping costs have halted product tanker traffic despite crude shipments continuing normally.
Ukrainian drone strikes have reduced Russian fuel exports by 3 million to 3.5 million barrels per day, tightening global product markets. The premium for diesel versus crude has climbed to near its highest level in over 15 years, according to Pouyanne. Shipping a very large crude carrier with a 2 million-barrel capacity through the Hormuz currently costs about $20 million, making refined product transport commercially unviable.
In the U.S., Pouyanne warned gasoline prices would not fall below $4 per gallon, contradicting expectations tied to policy goals. In Europe, he cautioned consumers would face higher costs as product supply tightens.
