Industry executive warns of impending shortage of diesel fuel on East Coast

Americans have faced temporary shortages of a variety of goods over the past couple of years, largely due to supply chain bottlenecks related to pandemic shutdowns, but one of the most consequential shortages may be about to hit the East Coast of the United States particularly hard in the coming weeks and months.

There are now dire predictions of an impending shortage of diesel fuel on the East Coast, and billionaire John Catsimatidis, CEO of United Refining Co., is among those sounding the alarm on the imminent dearth of supply, the Daily Caller reported.

This is hugely important because a shortage of diesel fuel means trucks can’t run, which means goods won’t be delivered to destinations, which will result in additional localized shortages of all sorts of things necessary and vital to a functioning society, not to mention arguably less severe ripple effect problems across the rest of the country.

Already low inventories further strained, shortage looming

In a phone interview with Bloomberg News, Catsimatidis warned, “I wouldn’t be surprised to see diesel being rationed on the East Coast this summer.”

“Right now inventories are low and we may see a shortage in coming months,” he continued.

However, while Catsimatidis expects to see a shortage of diesel fuel headed into the summer, his outlook on supply issues isn’t quite so dire for regular gasoline, though he does anticipate seeing record-level high prices soon and said, “Drivers will pay the highest gasoline prices ever paid for Memorial Day.”

Bloomberg noted that the East Coast was already experiencing record-low inventories of diesel fuel, a problem that stemmed from the shutdown of refineries during the initial phase of the pandemic due to drastically reduced demand related to lockdowns and stay-at-home orders, among other factors.

The problem has also been exacerbated in recent months due to the fact that the U.S. has increased the amount of diesel fuel it exports to other nations to help make up for the loss of Russian fuel that has been banned by many countries in response to the ongoing invasion of Ukraine.

Truck stop chains making preparations, average prices continue to rise

Bloomberg further reported that truck stop chain Pilot Flying J Inc. announced that it had developed contingency plans to deal with the expected shortage of diesel fuel and was “taking additional actions to secure extra supply and mobilize our fleet to deliver diesel to areas facing tight availability, such as Virginia and Georgia.”

Likewise, Marketwatch reported that the Love’s Travel Stop chain of truck stops said in a statement that it is “monitoring the fluid situation on the East Coast, we have experienced minimal outages during low traffic hours,” but added that, at least as of now, “The company has no plans to restrict purchases of diesel.”

According to the U.S. Energy Information Administration, the average price of a gallon of diesel fuel on the East Coast as of Monday was $5.907, nearly 30 cents higher than the national average of $5.623 and up more than 20 cents over last week and $2.747 over this time last year.

The average price per gallon of regular gasoline on the East Coast is currently $4.237, slightly less than the national average of $4.328 but still up nearly 15 cents from last week and $1.374 over a year ago.

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