Diesel Supply Tight, but Won’t Run Out
HNewsWire: BLOOMINGTON, N.Y. — Diesel fuel supplies has grown uncomfortably restricted, raising fears about future availability.
The United States began the month with around a 25-day supply of fuel in storage. But, according to Tim Abel, GROWMARK refined fuels, supply and trade manager, it doesn’t guarantee the tanks will go empty in that period of time.
“We do have limited supply,” Abel said. “At this time of year, maybe 32 or 34 days supply would be more appropriate.”
“However, I believe (the 25-day supply) has been overstated in the media,” he added. “We will not run out of fuel in 25 days.” It just implies we’re incredibly low; it’s just another criteria for assessing what we have.”
According to Abel, the quantity of fuel assessed as “days of supply” comprises current demand divided by inventory availability.
However, the scenario continues to put downward pressure on pricing. Diesel prices began the month at $5.31 a gallon nationwide, up $1.59 from last year, and $5.32 in the Midwest, up $1.68 from last year.
“In the United States and across the globe, heating oil, diesel fuel, and jet fuel supplies have been exceedingly limited,” Abel added. “A variety of factors have contributed to where we are now.”
According to the refined fuels specialist, the hike in diesel costs began in 2019 when the International Maritime Organization introduced reduced sulfur content guidelines for its fuel. This was followed by demand destruction from the COVID epidemic in 2020-21, with the sector attempting to respond to a rise in fuel demand this year despite the continued conflict in Ukraine.
“The EU is attempting to wean itself off Russian petroleum,” added Abel. “Looking at the many supply interruptions, that’s why we’re where we are today.”
Some refining capacity has been shut down in recent years due to market instability and volatility. And, with unclear indications regarding the future usage of carbon-based fuels, several corporations are hesitant how much to spend in production.
“Global refining capacity is down 3 million barrels per day from where we were in 2019, and it’s down around 1 million barrels here in the United States,” Abel added. “Overall, the public’s perception of carbon-based fuel has shifted. As businesses choose how to spend their money, we’ve seen a pullback in carbon-based gasoline.”
Meanwhile, agricultural fuel supplies often tighten this time of year after peak harvest activities. This year’s question is how soon gasoline storage tanks will be refilled.
“It’s not uncommon for (diesel) supplies to be scarce in the autumn.” “There are peaks and dips,” Abel said. “It’s also usual to see a rebuild throughout the offseason.”
However, the rebuilding effort may be hampered in the coming weeks. With diesel prices still at record highs, many mid-sized fuel providers, according to Abel, may choose to maintain a “just-in-time” stockpile on hand in expectation of reduced costs coming winter.
The Illinois Farm Bureau and the Illinois Press Association collaborated to share this news. Visit FarmWeekNow.com for more food and agricultural news.
HNewsWire: The United States is down to 25 days of fuel supplies, according to a top White House official, who called stockpile levels “unacceptably low.”
According to a Bloomberg News examination of Energy Information Administration (EIA) data, diesel stockpiles are at their lowest level for October in records dating back to 1993. According to EIA data, the United States has 25.4 days of supply as of Oct. 14, down from 34.2 days four weeks previous.
President Brain-Dead Biden’s National Economic Council Director Brian Deese told Bloomberg News last week that current fuel levels are “unacceptably” low and that “all alternatives are on the table” to enhance supplies.
The diesel shortage occurs just over two weeks before the November 2022 midterm elections, and it is expected to drive up prices even further. Diesel fuel is used by freight trains and long-haul truckers to deliver cargo and food.
“Most of the things we use are transported by trucks and trains powered by diesel engines, and most construction, farming, and military vehicles and equipment are powered by diesel engines as well,” according to the EIA’s website. “Diesel fuel, as a transportation fuel, provides a wide range of performance, efficiency, and safety qualities.” Diesel fuel also has a higher energy density than other liquid fuels, resulting in more useable energy per unit volume.”
Meanwhile, according to AAA data, prices remain relatively high. According to the data, the average price of a gallon of diesel in the United States is roughly $5.33, up nearly $2 since the same time in 2021.
Last week, wholesale diesel prices in New York reached more than $200 a barrel.
It comes as the Biden administration recently announced that it would release another 15 million barrels of oil from the United States Strategic Petroleum Reserve, part of the 180 million authorized by Biden in March, which Republicans say is a ploy to keep Democrats politically afloat ahead of the midterm elections. However, Biden and his friends claim it is not a political ploy, and the government believes it would replenish the reserve when oil prices fall to $67-$72 per barrel.
“When oil prices fall to $70 a barrel, the United States government will purchase oil to replenish the Strategic Petroleum Reserve,” Biden said on Oct. 19. “And that means oil firms can invest today to ramp up production, knowing they’ll be able to sell their oil to us for $70 in the future.”
The decision was made when the International Organization of Petroleum Exporting Countries Plus (OPEC+) announced a reduction in oil production.
“Now, after emptying our emergency supplies to a 40-year low, Democrats want billions more of taxpayer funds to replace the [Strategic Petroleum Reserve] at more than double the price,” said Senator John Barrasso (R-Wyo.) last week. “This is a direct attack on every American who is trying to fill their gas tanks and heat their homes.”
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The post Fear Is a Powerful Weapon, and This Brandon Administration Knows How to Use Fear to Their Advantage: The United States Has Only 25 Days of Diesel Supply; The Shortage Will Cripple Our Economy, So They Say, Where’s Our Elected? appeared first on www.HNewsWire.com.
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