In 2025, Light Diesel Oil (LDO) prices worldwide showed moderate fluctuations, driven largely by global crude oil trends and regional supply-demand dynamics. At the start of the year, prices trended downward as Brent crude gradually declined, reflecting expectations of slower global trade and easing economic growth. However, in the second quarter, geopolitical tensions in the Middle East caused short-term spikes in crude oil, briefly pushing LDO prices higher in several regions. These supply concerns affected shipping and refining costs, increasing the base cost of diesel fuels.
Refinery margins for diesel were generally stable but saw temporary surges during periods of high demand, particularly in Europe, as distillate inventories fell amid export surges and geopolitical uncertainty. Biofuel compliance credit prices, such as RINs in the U.S., added to overall costs for diesel blending, creating additional short-term volatility in North America. In contrast, regions with ample refinery capacity and strong stock levels experienced smaller price fluctuations. Currency shifts in key importing nations also affected local LDO costs, making some markets more sensitive to global price swings than others.
Despite these fluctuations, LDO remained less volatile than gasoline, as it is often produced in higher volumes and stored more easily, providing a buffer against sharp market shocks. Seasonal variations in demand, particularly for heating in winter months, caused small regional price increases, but globally, the overall trend was a gradual rise with temporary spikes rather than extreme volatility.
Analyst Insight
According to Procurement Resource, Light Diesel Oil (LDO) prices are expected to remain moderately stable in 2026, with only short-term fluctuations likely if geopolitical tensions or crude supply disruptions occur.
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During the second half of 2024, the Light Diesel Oil market followed a weak and uneven trend as global energy markets faced slowing demand and changing fuel usage patterns. Market sentiment remained cautious across regions, largely influenced by soft crude oil prices, oversupply concerns, and reduced consumption from key end-use sectors such as transportation and industry.
In Asia, demand for Light Diesel Oil stayed under pressure due to slower economic growth, particularly in China. The transport and logistics sectors consumed less diesel as businesses adjusted operations amid weak activity. A noticeable shift toward alternative fuels like LNG further reduced diesel usage, especially in heavy duty transport. Refiners responded by managing output carefully, but ample supply and poor buying interest continued to weigh on the market.
European markets also showed mixed behaviour during H2’24. While refinery output remained high, demand from downstream industries stayed moderate. Temporary supply disruptions caused by maintenance activities created short-lived fluctuations, but these were not strong enough to support a sustained recovery. Lower crude oil values and sufficient inventories kept prices restrained.
In North America, the LDO market remained relatively stable but leaned weak. High crude production, rising fuel stocks, and seasonal demand slowdown limited any upside movement. Improved refinery efficiency and steady supply further reduced price pressure.
Analyst Insight
According to Procurement Resource, Light Diesel Oil prices are expected to remain subdued, as demand recovery stayed slow and supply conditions remained comfortable.
Light Diesel Oil, or LDO, is basically a blend of components from the distillation process of diesel. It is utilised in engines with less than 750 rpm, for example, in boilers and furnaces. LDO is also recognised as distillate fuel or marked oil since it is marked with a colouring substance. The flash point, that is, the lowest temperature of ignition for LDO is 66o C.
CxHy
Boilers, Furnaces, Air pre-heaters, Lower rpm engines, Lift irrigation pump sets, Fertiliser plants., Bunker, DG (diesel generator) sets
Distillate Fuel, Marked Oil
Royal Dutch Shell (Shell), Chevron Corporation, Bajrang Petrochemicals Pvt Ltd
CurrencyUS$ (Data can also be provided in local currency)
Supplier Database AvailabilityYes
Customization ScopeThe report can be customized as per the requirements of the customer
Post-Sale Analyst Support360-degree analyst support after report delivery
Note: Our supplier search experts can assist your procurement teams in compiling and validating a list of suppliers indicating they have products, services, and capabilities that meet your company's needs.
The production process of LDO involves the addition of a liquid-phase catalyst into a liquid-phase catalytic cracking furnace and addition of a gas-phase catalyst into a gas-phase cracking furnace to gasify the waste oil by heating at high-temperature. This is followed by its collection and then cooling using a cooling furnace to obtain light crude oil. This light crude oil is further processed to finally form Light Diesel Oil.
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This report presents a detailed cost analysis of diesel production from crude oil using the fractional distillation.
This report presents a detailed cost analysis of biodiesel production from fat or vegetable oil using transesterification.
This report provides the cost structure of LPG production by the petroleum refining process. In this process, the crude oil recovered is separated into oil and wet gas via a gas trap.
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