I had a similar issue where I was getting the following when publishing from Visual Studio 2013 to my Azure Cloud Service with a web role and a worker role. This occurred after upgrading the project from Azure SDK v2.4 to v2.5:
2:41:59 PM - Applying Diagnostics extension.
2:42:01 PM - Object reference not set to an instance of an object.
Even after working with a Microsoft Developer I could not get it to show me any kind of stack trace to indicate where the null was coming from. He just happened to notice something funny in my cloud configuration under the "Roles" folder that looked strange.
The problem was that the diagnostics.wadcfgx is needed for an SDK 2.5 project, whereas before that version the diagnostics.wadcfg is needed. (Note the "x" in the file extension.) Apparently the worker role did not have this file automatically created when the project was upgraded.
In order to fix this particular issue, just right click on the role (in the roles folder under cloud configuration) and select "Add Diagnostic Configuration", then Build the solution and attempt to publish. These diagnostics files are ONLY needed when publishing directly from Visual Studio.