As military action dominates headlines the last week, diesel futures have soared roughly $.80 to new highs even as demand figures for the product are down roughly 7% year over year. That is a huge number. Gasoline demand is showing cracks but still up on an annual basis. This latest spike may have been the tipping point in the demand destruction theory. Transit through the strait has all but ceased and the U.S. has reestablished a blockade of any ships trying to enter. So it looks like we are back to square one and at a stalemate. Again, fundamentally, the US has plenty of product, it becomes the financial and logistical hurdles that have to be overcome. That is, if you own a ship of diesel fuel, would you sell it into a US port or overseas for 5x,6x more? Partly the reason why Diesel exports are up almost 40% over last year. Not only that, but the backwardation is keeping many domestic storage tanks at minimums because of the pending paper losses. A strong supplier and hauler relationship will be important in the coming weeks, one that is both is even better.