The current low level of diesel fuel is “terrifying,” Montana Attorney General Austin Knudsen said, due to its potential effect on the supply chain and food production.
As the United States faces record-high inflation and gas prices, concerns are rising about inadequate supplies of diesel fuel, which, according to gas companies, will only drive up its price.
Data from the U.S. Energy Information Administration (EIA) shows that, as of Oct. 21, the United States had 26 days of supply, a drop from around 34 days five weeks ago.
This shortage should concern the shipping industry, the freight industry, trucking, and railroads, Knudsen said.
These transportation industries will face higher prices and “that’s just going to further exacerbate our supply chain problems in this country,” he added.
Truckers are the “lifeblood” of the country, and the present administration should realize that “trucks run on diesel fuel, they don’t run on fairy dust and rainbows,” said Knudsen. “This is going to have tremendous ripple across our economy.”
According to Mansfield Energy, diesel markets operate comfortably with about a 35- to 40-day supply and start to face problems when supply gets down to 30 days, so the 25-day supply is a critical issue.
“There is simply a shortage of product as compared to three years ago,” said Michael Mansfield, CEO of Mansfield Energy, during an interview with Fox & Friends on Nov. 2, adding that there is about 1 million barrels a day less diesel refining capacity than in years past.
Government Pushing ESG
“We shouldn’t be surprised when we see that those industries are disincentivized from producing more of what we need in this country. They’re under full-out attack, not just from the administration, but from this administration’s friends in big banking,” he continued.
Knudsen, along with 18 other state attorneys general, launched an investigation into six major banks for “potentially deceptive trade practices tied to ESG policy-related actions.”
Meanwhile, Mansfield did not specifically mention ESG policies but said regulatory costs have made it impossible for some oil refineries to continue their business.
Some refineries have been damaged but “others have simply closed, just because there’s the regulatory cost of running the refineries, it’s gotten to the point where they simply can’t do business anymore. I believe there are about seven fewer refineries in the U.S. today than there were in 2019,” said Mansfield.
