WebMD is an excellent resource for diabetics.  Here are some quick benefits listed regarding the effect of exercise on diabetes.

Helps your body use insulin, which controls your blood sugar

Burns extra body fat

Strengthens muscles and bones

Lowers blood pressure

Cuts LDL (“bad”) cholesterol

Raises HDL (“good”) cholesterol

Improves blood circulation

Makes heart disease and stroke less likely

Boosts energy and mood

Tames stress

When you exercise, your body needs extra energy from blood sugar, also called glucose.

When you do something quickly, like a sprint to catch the bus, your muscles and liver release glucose for fuel.

The big payoff comes when you do moderate exercise for a longer time, like a hike. Your muscles take up much more glucose when you do that. This helps lower your blood sugar levels.

If you’re doing intense exercise, your blood sugar levels may rise, temporarily, after you stop.

Here is an abstract of a scholarly, peer-reviewed article for those who might like to go a bit deeper into the science behind the magic of exercise on diabetes. (Hint, the last 2 sentences of the abstract below are key)

World J Diabetes. 2014 Oct 15;5(5):659-65. doi: 10.4239/wjd.v5.i5.659.

Acute effects of physical exercise in type 2 diabetes: A review.

Asano RY, Sales MM, Browne RA, Moraes JF, Coelho Júnior HJ, Moraes MR, Simões HG.

Abstract The literature has shown the efficiency of exercise in the control of type 2 diabetes (T2D), being suggested as one of the best kinds of non-pharmacological treatments for its population. Thus, the scientific production related to this phenomenon has growing exponentially. However, despite its advances, still there is a lack of studies that have carried out a review on the acute effects of physical exercise on metabolic and hemodynamic markers and possible control mechanisms of these indicators in individuals with T2D, not to mention that in a related way, these themes have been very little studied today. Therefore, the aim of this study was to organize and analyze the current scientific production about the acute effects of physical exercise on metabolic and hemodynamic markers and possible control mechanisms of these indicators in T2D individuals. For such, a research with the following keywords was performed: -exercise; diabetes and post-exercise hypotension; diabetes and excess post-exercise oxygen consumption; diabetes and acute effects in PUBMED, SCIELO and HIGHWIRE databases. From the analyzed studies, it is possible to conclude that, a single exercise session can promote an increase in the bioavailability of nitric oxide and elicit decreases in postexercise blood pressure. Furthermore, the metabolic stress from physical exercise can increase the oxidation of carbohydrate during the exercise and keep it, in high levels, the post exercise consumption of O², this phenomenon increases the rate of fat oxidation during recovery periods after exercise, improves glucose tolerance and insulin sensitivity and reduces glycemia between 2-72 h, which seems to be dependent on the exercise intensity and duration of the effort.