Just as the European Commission plans that states with more natural gas stored will ration it and give it to other countries and go into shortage themselves, U.S. truck drivers, airlines, farmers and other diesel users are facing rationing of diesel fuel because of America’s hurried oil and also diesel fuel shipments to Europe. The logistics firm Freightwaves on May 12 reported “three very large trucking fleets” preparing for diesel pumps at fuel stations to run dry across the Mid-Atlantic and Northeast regions this Summer.
Typical is a message on May 5 for truck fleet operators, from the diesel depot network Love’s: “Dear fleet customers, Due to historically low supply, diesel availability in the Eastern U.S. … your drivers could start to see the effects of these supply issues in the coming days. We expect to have [Loves] locations experiencing temporary, intermittent diesel outages.” One fleet operator passed on: “Attention to all drivers: Hearing from Love’s that they expect diesel shortages to hit some of their Eastern U.S. stores in the coming week.”
Diesel fuel wholesale inflation is at 275% over the year through April 2022 in the United States. The Department of Energy said on May 13 that inventories of diesel on the East Coast are at their lowest level since 1990, in absolute volume, with trucking demand much higher now than three decades ago. The average retail price across the United States on May 12 was $5.56/gallon, up by 53 cents/gallon or 10% in April alone.
Consequently, in physical terms less freight is moving (at least by truck) in May than in March and April, according to Freightwaves, and this is completely opposite to the normal upsurge in freight volume, particularly foods, in spring and early summer.
And this is with only about half of Russian oil exports to Europe cut off, 1.5 million out of 3 million barrels per day. That has been done by “self-sanctioning” by large numbers of importers in Europe, including oil majors, with official boycotting of Russian oil by the EU still six months away.
