What is Going On? Are We in a Fuel Crisis?

Recently, fears began percolating that the United States is in a diesel fuel crisis. With the price of gas spiking and delivery delays, people instantly began to worry that we would be in a state of emergency. We are here to reassure you that diesel may be constrained, but there is enough supply on hand where we will not be going into a national crisis. 

What is Happening? 

Fuel supply in the United States is certainly constrained. As the world emerged from COVID-19 restrictions and a war in Ukraine began, the refinery capacity was also reduced. Some imports have been halted as a result of the war, lessening the United States’ overall fuel supply. This was a perfect combination to create a fuel shortage for our nation. These factors worked together to lay the groundwork for limiting diesel supplies. 

Historically, the northeastern parts of the United States depend on heating oil to survive the harsh winter. As winter gets closer, diesel from the southeast has been shipped to those states to meet this demand and help them prepare for winter. That is causing the southern states to see a supply constraint 

Additionally, other factors are affecting diesel supply. Mississippi has been in a drought, decreasing the Mississippi River’s water level. This is affecting the basin’s waterborne terminals and has caused barge traffic to vastly reduce. Over in Toledo, BP’s refinery had an explosion leaving the plant inoperable until early 2023.  

How Are People Reacting? 

For a few days, alarm began to set in as people grew concerned for the amount of diesel supply available in the United States. Politicians across America have created executive orders in an attempt to help the diesel situation. Georgia is extending their temporary suspension of the state motor fuel and locomotive fuel tax and declared a state of emergency. South Dakota granted an hour of service waiver to help truck drivers transporting liquid products. Similarly, Nebraska is temporarily allowing truck drivers to work extended hours to haul fuel to its final destination. 

Is There Reason for Concern? 

While diesel supply in the United States is at a record low, experts agree that there is no reason for panic. Diesel supply may be tight but there is enough to keep society running smoothly. Headlines announced that there is only a 25 day supply remaining, which alone would be reason for concern. However, this does not consider that within those 25 days, new diesel will be added to the supply. It is a constant give and take and it is important to remember that we will not run out of fuel within 25 days.

Overall, the United States is not set to experience a national crisis in the immediate future.  Jumping into panic mode without doing a little more research can cause more harm and drain the current diesel at the pump. Everyone will need to be more conscious when they go to fill up their tanks, and fuel suppliers should implement a strategy to efficiently deliver fuel to help combat the constraint. 
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