Today’s briefing:
— Why diesel is soaring
— Red carpet treatment
— An embassy for a landless state
Your Insider’s briefing:
— Why diesel is soaring
— Red carpet treatment
— An embassy for a landless state
Good morning {{first_name | Intriguer}}. I was at a neighbourhood barbecue the other night and found myself in the grill-queue standing next to two new arrivals, both European radiologists. Sure, groomed to the hilt, plates in hand, but still far from home, and very much not standing in a European hospital.
Between their tentative squirts of this exotic substance called ketchup, I couldn’t resist asking the question: wasn’t AI’s raw pattern recognition power meant to replace all radiologists? Their eyes twinkled like they’d been prepping for this moment.
They then confirmed via anecdote some of the stats I’ve seen for months: radiology hiring is actually up, because tech has lowered the scanning hurdle, meaning more scans, and more demand for trained docs to explain them. And yet at the same time… a decade of doomerism means a generation of med students in their home country just avoided training in radiology, assuming it was a fading speciality.
So with radiology demand up but the supply of radiologists down, these European radiologists now get to name their price, live where they like, and review fracture scans between neighbourly barbecues, while ol’ hometown Europe sleeps.
I mention this because maybe it’s shaping up as an example of humans ditching one system before the next one is really ready. And if you sniff closely, maybe there’s a similar market phenomenon behind today’s diesel crisis?
 | Managing Editor Jeremy Dicker |
PS — this is our last briefing for the week but we’ll be back Monday!
Number of the day
170,000+
That’s how many additional people in Indonesia have been affected by respiratory issues since August, amid spreading wildfires the country is struggling to tame.
Fuel for thought.
Diesel used to be the unsexy cousin at the fuel pump — the one that smelled faintly of ferry docks, farm equipment, and long bus-rides to summer camp. No longer.
Here’s why diesel prices have now gone wild.
First, diesel, you say?
It’s what you get when you refine crude oil through a fractional distillation process. It’s thicker and less volatile than gasoline and requires a different motor to run – something you might’ve learned the hard way if you ever pumped the wrong gas.
You might think it’s just for old timey cars, but it’s critical for…
heavy machinery
76% of all US trucking, and
most US freight and passenger rail (plus ~20% of Europe’s rail traffic).
Or to put it another way, if it’s heavy and steady it’s probably got a diesel engine, which uses compression rather than a spark to get combustion going — that means more torque, power, and efficiency at lower revs, while requiring fewer repairs.
So diesel really keeps our economies running (albeit at low to moderate speeds) — construction, logistics, groceries, you name it.
Then second, what’s the problem here?
Congrats on not owning a Winnebago and therefore being unaware that diesel prices have soared.
And we’ve already explored one big price driver, which is just the general oil price, spiked by wars around Hormuz, Bab-el-Mandeb, and Russia.
But over the past 12 months, US diesel has specifically soared higher (+74%) than petrol (+41%). Ditto in the EU, where diesel is up 45% while petrol is up 29%.
Why is diesel faring worse?
First, thanks to multi-billion-dollar investments over the past decade (think Kuwait’s Al Zour, UAE’s Ruwais, Iraq’s Karbala), the pre-war Middle East was refining 15% of the world’s diesel, or a fifth of all global seaborne exports.
But Iran and its proxies have now struck not just tankers and pipes, but also key refineries, meaning net diesel exports from the Gulf are now barely a quarter of pre-war levels! Ukraine’s counterattacks on Putin’s refineries are also a driver, though the “missing” Russian diesel is maybe a third of what’s now offline in the Gulf.
Second, that’s all come at a time when refineries in the West were already working near capacity, with little buffer to absorb the Gulf’s jilted customers. That’s partly because the US and Europe haven’t built a major new refinery since the 70s!
Why? A mix of market forces and energy transition. Plus those older US refineries — optimised for the domestic passenger car market — now produce two barrels of petrol for every one barrel of diesel. You can’t just flick a switch back to diesel.
And the only country with any real meaningful spare refining capacity is… can you guess? Yes, China. But Beijing has kept those refineries on a short leash, to stabilise both its own diesel prices but also the massive local crude inventories feeding them.
Sure, you might wish China just unleashed its refineries (as it started doing from July-August), but total liberalisation would send those refineries right back out into international oil markets hoovering more crude, driving world prices even higher.
So guess who’s now mulling a diesel export ban instead? Yes! That bastion of free markets, the United States of America. Six weeks out from high-stakes midterms, a diesel export ban could initially curb pump prices and maybe slow President Trump’s polling slide, rest of the world be damned.
But longer term, an export ban could soon max out US storage, forcing refineries to curb their output and pause their investments, all risking another supply crunch.
So… why not just build more refineries? Even with political backing and streamlined approvals, you’re looking at five-to-seven years. Aka, there’s no quick cavalry coming.
Intrigue’s Take
So… is this Jeremy’s intro radiology dilemma above, but with a smokestack attached? Did we semi-retire one energy system before figuring out its replacement? Did we just get really good at moving the unglamorous bits of our energy system — much like our manufacturing base — elsewhere? Did we just take the spreadsheet win, but leave the heavy, dirty, capital-hungry act of turning crude into distillates to the Gulf? Did we outsource the cost, but oops, also the sovereign capability haha?
The stats suggest that’s…
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Intrigue’s Take
So… is this Jeremy’s intro radiology dilemma above, but with a smokestack attached? Did we semi-retire one energy system before figuring out its replacement? Did we just get really good at moving the unglamorous bits of our energy system — much like our manufacturing base — elsewhere? Did we just take the spreadsheet win, but leave the heavy, dirty, capital-hungry act of turning crude into distillates to the Gulf? Did we outsource the cost, but oops, also the sovereign capability haha?
The stats suggest that’s more true for Europe, which has had to swap out its Russian energy for Gulf (and US) suppliers to avoid financing Putin’s aggression on its doorstep. But that narrative is less true for the US, which has long been a major diesel supplier. The lesson here is more something that energy nerds have yelled for years: the underlying myth of US energy independence.
The shale revolution vaulted the US into an unfamiliar role as the world’s top energy exporter by ~2019. That fuelled a narrative that maybe the days of local pumps being held hostage by some foreign quagmire might be over. But this was always theoretically untrue in two ways: one is the fact that US refineries are so heavily integrated with niche Canadian heavy-oil supplies. And that theory suddenly feels very real amid President Trump’s trade war with the Canadians.
The second big caveat is that, produce all the energy you want, but short of going full Kim Jong Un and pulling up the drawbridge, energy prices are mostly global. The folks that originally built out — and now own and maintain — America’s half-trillion-dollar legacy refining infrastructure? They sell their product to the highest bidder, whether in Texas or Tokyo. That’s why they built it all.
It’s also partly why the American Petroleum Institute — ordinarily a Trump-friendly constituency — is now so rabidly against the president’s export ban idea. As for who’s for it? Interestingly, it’s another traditionally Trump-friendly constituency: Republicans in farm states where fuel costs are eating margins.
Anyway, it’s tempting to conclude from all this that there’s an inherent clash in a world trying to both de-globalise and de-carbonise. And while prices will bear that out for now, longer term those two trends both point in the same direction as the engineering: renew and electrify what you can, and shift whatever else you can over to drop-in synthetics, geothermal, whatever. We don’t pretend to know the exact make-up or market, but that’s the prize both capital and capitals will chase — out of raw self-interest — until some new equilibrium emerges.
Sound even smarter:
The White House now denies it is preparing a flat diesel-export ban, with Energy Secretary Chris Wright saying the focus is on getting more diesel in.
Diesel accounts for ~30% of total global demand for refined fuels.
US refineries can (and do) tweak their ‘yield’ to produce more diesel or petrol, but this quickly hits hard chemical limits once you boost by ~3-5%.
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Meanwhile, elsewhere…
🇨🇳 CHINA — Tarmac time.
President Trump has personally greeted President Xi on arrival at Joint Base Andrews, in the kind of tarmac gesture not seen (popes aside) since JFK welcomed the UK’s Harold Macmillan in 1962. The substantive White House summit kicks off later today (Thurs) DC time. (BBC)
Comment: The tarmac gesture — not reciprocated in Beijing — maybe just reflects Trump’s instincts for personalised strongman rapport. Xi, on the other hand, might interpret it more as his own preferred ‘G2’ dynamic: framing the US and China as equal titans who can sit down, cut through the bureaucratic noise, and solve historic issues directly. No framing alone, however, can dislodge their major structural differences across tech, tariffs, and Taiwan (though there are rumours Xi might use 1982’s Reagan-Zhao ‘Third Communiqué’ to pressure Trump into halting arms sales to Taiwan). And plot twist: those F-35 parts that somehow went missing in Hong Kong? Bloomberg says China now has them — rather neat timing for pre-summit leverage. So overall, we still expect a truce extension (Bessent confirmed overnight it now runs to January 10), some trade dressed up as deals, and quite a few photo ops — but not a major breakthrough, particularly when you recall they’ll likely meet another two more times this year (at Xi’s APEC summit then Trump’s G20).
🇦🇺 AUSTRALIA — Naughty agents.
Appearing at the UN in New York, Prime Minister Albanese has revealed that one of OpenAI’s autonomous agents hacked Australia’s public-facing Medicare statistics portal back in June. Canberra only found out via a belated public-mailbox email from OpenAI this month! (ABC)
Comment: Albanese apparently told OpenAI’s Altman that Australia isn’t happy, but we wonder if it might really require some hard legal liability for AI labs to shift from their current mystical, alignment-puzzle, hands-in-hair, let’s-admire-the-problem-together think pieces, to actually treating their own product as their *own* existential liability.
🇺🇳 UNITED NATIONS — Gaza invoice.
Meeting on the UNGA sidelines, President Trump’s Board of Peace has unveiled a six-month, $2.45B starter plan for the reconstruction of Gaza. The 66 projects cover housing, diesel, rubble, UXO clearance, and waste. Longer term, the Board is estimating reconstruction will cost $71B over a decade, with $18B pledged but only $280M handed over so far. (MEE)
Comment: The Board is trying to project momentum while its broader ceasefire remains fragile. But the bigger story might be structural: by running the reconstruction through the Board’s private JPMorgan-managed funds rather than traditional UN or aid agencies, DC is seemingly trying to establish a US-led alternative to the UN bodies that staffed pre-war Gaza. The test is now whether the region’s big donors start writing actual cheques before the security and governance pieces exist.
🇪🇹 ETHIOPIA — War, again?
It looks like the Ethiopian military has slid back into open civil war against Tigrayan forces in the north, four years after signing their peace deal. Each side now blames the other, with Tigray forces already claiming three airports. (NPR)
Comment: Beyond the risk of a horrid repeat, the worry is this could all draw in Ethiopia’s neighbours and metastasise into a regional war — a possibility we explored earlier this year.
🇮🇱 ISRAEL — Arab parties banned?
Israel’s election committee has moved to ban the country’s main Arab parties from next month’s high-stakes vote, in response to a petition from hardline members of Netanyahu’s ruling coalition. The Supreme Court is expected to overturn for lack of evidence of a breach (like incitement to racism or support for armed struggle against Israel). (Bloomberg $)
Comment: It looks like an attempt both to discourage Arab-Israelis from voting (they’re 20% of the electorate), and rally ultra-nationalists.
🇨🇫 CENTRAL AFRICAN REPUBLIC — Hague hammer falls.
International Criminal Court (ICC) judges have convicted former Séléka commander Mahamat Said of crimes against humanity perpetrated at an infamous detention centre in Bangui — that’s the capital his predominantly Muslim coalition briefly held after mounting a 2013 coup, escalating a sectarian war until a regional intervention in 2014. (ICC)
Comment: That’s long-awaited justice for Said’s victims, and ordinarily the kind of case that might resonate with some US voters (the conviction notes Séléka often targeted Christians). But the judgment dropped just as President Trump was at the UN reiterating his call for nations to *ditch* the ICC. And the first to heed his latest call seems to have been… Chad, the neighbour that supplied many of Said’s mercenaries.
🇷🇺 RUSSIA — Plus-one for Miami.
Secretary of State Rubio has confirmed the White House has invited Vladimir Putin to December’s G20 summit at a Trump resort in Miami. (Moscow Times)
Comment: If Putin accepts, it’ll be his first in-person appearance at a G20 summit since 2019. It’s a way for Trump not only to keep playing his version of peacemaker, but also thumb his nose at the International Criminal Court (which has a warrant for Putin’s arrest). By dismantling the West’s post-invasion strategy of isolating Putin, it puts other allied G20 members in an awkward spot: boycott Trump’s summit, pose with Putin, or some kind of compromise (attend but no family photo?). The G20 itself lost its raison d’etre years ago, but a US-hosted summit is tougher to skip.
Extra Intrigue
In other worlds…
Aviation: Singapore Airlines has reclaimed the title of World’s Best Airline at the 2026 Skytrax Awards in London, dethroning Qatar Airways. Eight of the top 10 hail from the Middle East or Asia, being mostly state-owned or backed.
Gaming: The approaching 19 November release of the highly-anticipated Grand Theft Auto VI is triggering a rush of annual leave requests, while rivals readjust their own release windows to stay out of the game’s shadow.
Real estate: India’s fintech tycoon Dinesh Thakkar just bought an entire sea-facing, 63,000 sq ft luxury tower in Mumbai for ~$80M — he’s converting it all into a personal pad, making this India’s costliest known single-home purchase.
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Embassy of the day
Pic courtesy of the Sovereign Order itself.
That grand ol’ structure above is the embassy for a sovereign entity that posts its own diplomats, issues its own passports, mints its own coins, and even maintains full diplomatic ties with 115 countries, but... only has three citizens and zero territory!
Welcome, dear Intriguer, to Villa del Priorato, the official Rome embassy for the pithily named Sovereign Military Hospitaller Order of Saint John of Jerusalem, of Rhodes and of Malta… or ‘SMOM’ for short.
How do you score this sweet sweet statehood without a state?
Blame a millennium of geopolitical musical chairs: founded in Jerusalem in 1099 as a Crusader-era medical order, the Knights eventually seized actual territory like Rhodes (1310) then Malta (1530) but got booted by Napoleon (1798) on his way to Egypt. So the Knights lost their turf but refused to surrender their sovereign rights.
Now based in Rome, they’ve since evolved into a humanitarian body running medical missions and disaster relief across 120 countries. And that’s how you end up with a landless state running diplomatic ties with more of the world than Kosovo.
Thursday quiz
We’re off our usual quiz-day (Friday) so enjoy our quiz today — see ya Monday!
It’s World Maritime Day.