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Tags: diesel fuel shortage | inflation
OPINION

Lauren Fix, The Car Coach: Diesel Shortages - Why You Should Be Worried

Lauren Fix, The Car Coach: Diesel Shortages - Why You Should Be Worried
(Dreamstime)

Lauren Fix By Monday, 16 January 2023 05:22 PM EST Current | Bio | Archive

Diesel supplies for this time of year are the lowest ever. This will lead to a shortage of many items and create a perfect storm. Winter is here yet, and the diesel supply chain is already falling short of demand at an accelerating rate. We have discussed this before but now the diesel levels are even lower than in the past months.

Tight refining capacity coupled with ever-depleting stockpiles will threaten the supply of consumer goods and materials for the coming weeks and months. If diesel levels continue to dwindle too low due to supply crunches, critical transportation networks such as ships, trains, airplane and trucks shipments will be severely impacted.

There is still a national diesel fuel shortage. This does not mean that we will run out of diesel. But the impact of a diesel shortage will impact every American.

Why, you ask? Diesel is also a power generation source for many utility companies and is also used in various capacities to heat homes and businesses in many parts of the world. In late October, Mansfield Energy issued a “code red” for diesel supplies in America’s Northeast and Southeast regions.

Bloomberg reported that “within months, almost every region on the planet will face a danger of a diesel shortage just as supply crunches in nearly all the world’s markets have worsened inflation and hurt growth.”

The crisis can clearly be seen at the pumps where diesel prices are now noticeably higher than gasoline prices, which are also sky-high. If things continue on their current direction, the diesel crisis could become a perfect storm and an inflation accelerant, the likes of which the world has never before been seen.

Diesel and fuel prices in general are based on crude prices as set on the global market. Due to supply bottlenecks and other problems, demand in some markets is far outpacing supply, which in turn affects everyone. This is basic economics 101. Anything and everything that gets moved in our economy, diesel is there.

Higher prices, lower supply means more than just the expense and limits of moving stuff around the country. The lack of diesel also means that people potentially could freeze to death. That is an even more serious factor. The cost the United States economy is about $100 billion, and that will impact everyone and everything. As of this week, diesel inventories are at their lowest point ever since 1982 when the government first began tracking and reporting data on the fuel. Diesel supplies are also at their lowest levels ever for this time of year.

The U.S. currently has just a 25-day supply of diesel fuel, the lowest level since 2008. What this means, just to be clear, is that if all diesel production stopped immediately, the country would run out of it in 25 days.

Of course, diesel is still being produced every day, so that 25-days-remaining figure will still be 25 days remaining tomorrow and the day after that. If production and supply problems persist, then over time that number could gradually drop down to a lower supply, and then we have bigger issues.

As for diesel distillates, which are gasoline, diesel fuel, kerosene and jet fuel are, to some degree, distillates; the four-week rolling average supply, and this based on a fluctuating demand, and demand has increased to its highest seasonal level since 2007, just before the infamous 2008 market crash.

According to an article from Zero Hedge, “Prices for U.S. diesel in the spot market of New York harbor have risen more than 265% since President Biden took the oath of office in 2021. Prices reached $5.37 a gallon in the spring of 2022 and have since slumped to $5.14/gallon.”

The tightest diesel market in the country right now is the Northeast where oil refineries have been shut down one by one over the past several years. What this means for the availability of winter heating oil and jet fuel supplies remains to be seen.

On last item I’d like to mention: There is no fossils in fossil fuels. Every time you hear the term fossil fuels being used by “experts,” you are being lied to. In 1892, at the Geneva Convention, J.D. Rockefeller paid scientists to call oil, fossil fuels to induce the idea of scarcity. The truth is oil is the 2nd most prevalent liquid on earth next to water and regenerates within the earth faster than it could be depleted.

There is so much more to discuss on this, put your comments below and let’s start the conversation.

You can support me by buying me a cup of coffee - the link is in the description. Thank you! https://www.buymeacoffee.com/laurenfix

We will be reviewing all of the newest cars on our YouTube channel Car Coach Reports.

Additional articles on our website https://www.CarCoachReports.com

"LAUREN FIX'S GUIDE TO LOVING YOUR CAR” Book - https://amzn.to/3ifDi3j

Total Car Score Podcast ► Hosts: Lauren Fix, Karl Brauer and Javier Mota. https://www.revolverpodcasts.com/shows/total-car-score/
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Lauren Fix, The Car Coach is a nationally recognized automotive expert, media guest, journalist, author, keynote speaker and television host. A trusted car expert, Lauren provides an insider’s perspective on a wide range of automotive topics and safety issues for both the auto industry and consumers. Her analysis is honest and straightforward.

© 2023 Newsmax Finance. All rights reserved.


LaurenFix
Diesel supplies for this time of year are the lowest ever. This will lead to a shortage of many items and create a perfect storm.
diesel fuel shortage, inflation
878
2023-22-16
Monday, 16 January 2023 05:22 PM
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