Friday, November 4, 2022
Tuesday, November 1, 2022
No, the U.S. isn’t going to run out of diesel fuel in 25 days
Tucker Carlson: The US is about to run out of diesel fuel
This mean that truckers and trains cannot transport food and other commodities. The economy could collapse.
Mansfield warned that at the U.S. economy level, consumers may feel pain at the pump, but for businesses that rely on diesel for operations, supply will still be available.
"That is not to say there will not occasionally be situations where there is a true physical lack of products," the company said. "Some cities might run dry on diesel for a few days, at least at the terminal level. But the fuel supply chain is dynamic, and suppliers will rally to fill in any gaps in supply."
"That is not to say there will not occasionally be situations where there is a true physical lack of products," the company said. "Some cities might run dry on diesel for a few days, at least at the terminal level. But the fuel supply chain is dynamic, and suppliers will rally to fill in any gaps in supply."
This is also the time of year that refineries are doing maintenance. They tend to do that in the spring and fall, which is when demand is lower and the weather is decent. So, refinery capacity drops at this time of year.
Third, U.S. refinery capacity has fallen in the past few years as several unprofitable refineries were closed. So, that's a new factor that has appeared in the past couple of years.
But the primary reason is the cutoff of Russian imports. Prior to Russia's invasion of Ukraine, the U.S. was importing nearly 700,000 barrels per day (BPD) of petroleum and petroleum products. Most of those imports were finished products and refinery inputs that boosted distillate supplies in the U.S.
The loss of those Russian imports has caused problems for refineries as they struggle to fill holes in their product slates. Refineries do have a small amount of flexibility in shifting gasoline production to diesel production. But it's a relatively small amount (e.g., ~5% in a refinery I once worked in). That also means that if refiners do shift production, it also potentially creates shortages in the gasoline market.
Some relief is on the way, as some diesel imports are on the way from Europe to the East Coast. But, the distillate market won't likely return to normal before next summer at the earliest.
Third, U.S. refinery capacity has fallen in the past few years as several unprofitable refineries were closed. So, that's a new factor that has appeared in the past couple of years.
But the primary reason is the cutoff of Russian imports. Prior to Russia's invasion of Ukraine, the U.S. was importing nearly 700,000 barrels per day (BPD) of petroleum and petroleum products. Most of those imports were finished products and refinery inputs that boosted distillate supplies in the U.S.
The loss of those Russian imports has caused problems for refineries as they struggle to fill holes in their product slates. Refineries do have a small amount of flexibility in shifting gasoline production to diesel production. But it's a relatively small amount (e.g., ~5% in a refinery I once worked in). That also means that if refiners do shift production, it also potentially creates shortages in the gasoline market.
Some relief is on the way, as some diesel imports are on the way from Europe to the East Coast. But, the distillate market won't likely return to normal before next summer at the earliest.
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