Diesel prices across most APAC and the GCC markets were around 5% to 10 % lower through 2025 relative to the Q1 2024 baseline, reflecting broader moderation in global crude benchmarks. Several markets diverged from this trend due to structural and policy-driven factors. KSA recorded a sharp increase of 44 % above the Q1 2024 baseline by Q4 2025, following a government-mandated Aramco pricing revision. Malaysia saw sustained price increases of 37 % above baseline, as the government progressively dismantled its long-standing fuel subsidy programme, raising the structural price floor. Thailand and Taiwan also edged above Q1 2024 levels, as Oil Fund disbursements thinned and CPC formula adjustments took effect.

Q1 2026 opened at levels consistent with prior-year conditions. The Middle East conflict in late February marked a clear inflection point, as disruption to the Strait of Hormuz drove benchmarks sharply higher, with the impact beginning to transmit to retail diesel markets toward quarter end.

Q2 2026 is likely to represent the peak in prices across most markets. Malaysia is expected to see one of the largest YoY increases, largely due to the absence of a broad diesel subsidy in Peninsular Malaysia. As a result, prices there tend to fluctuate more closely with global oil prices.

Singapore is also expected to see a sharp rise, as global prices are fully reflected in domestic fuel costs. Australia is likely to record a significant increase despite a temporary excise reduction from April, suggesting cost pressures remain high. Thailand may see near full pass through as support from its oil fund reduces.

Japan cushioned diesel prices through the Fuel Oil Price Mitigation Programme, which provides subsidies to oil wholesalers to limit the pass-through of global price increases. Taiwan maintained price stability through a managed pricing mechanism, with state-owned refiners absorbing a significant share of cost increases. In India, diesel prices remained relatively stable due to a combination of fiscal intervention and price controls. The government reduced excise duty by INR10 per litre in March 2026 to offset rising crude costs.

In the GCC, the UAE is expected to see a strong increase due to its market-linked pricing system, while KSA is likely to remain mostly stable with government-controlled prices.

Through Q3 and Q4 2026, prices are expected to ease as global crude retreats from conflict driven highs. The UAE is anticipated to de-escalate faster, underpinned by its post OPEC exit production dynamics. India remains a regional exception, as the May revision covered only a fraction of the correction required and further upward adjustments are likely through Q3 and Q4. Across APAC and the GCC, prices are expected to remain materially above pre-conflict baselines through year-end 2026.