Warning Issued In Several States For Diesel Shortages
A diesel supply alert has been issued by a major fuel logistics company.
Mansfield Energy issued a supply alert on Oct. 25th for diesel fuel markets on the east coast. They described the current fuel market as “rapidly devolving” and noted that “markets are now seeing extremely high prices in the Northeast along with supply outages along the Southeast.”
States On Alert
States included in the Mansfield Energy alert are North Carolina, South Carolina, Virginia, Tennessee, Georgia, Alabama, and Maryland. Mansfield Energy pointed to “poor pipeline shipping economics and historically low diesel inventories” which are “combining to cause shortages in various markets throughout the Southeast.”
The company said that the diesel shortages “have been occurring sporadically, with areas like Tennessee seeing particularly acute challenges.”
Mansfield Energy’s Statement
In many areas, actual fuel prices are currently 30-80 cents higher than the posted market average, because supply is tight. Usually the “low rack” posters can sell many loads of fuel before running out of supply; now, they only have one or two loads. That means fuel suppliers have to pull from higher cost options, at a time when low-high spreads are much wider than normal. At times, carriers are having to visit multiple terminals to find supply, which delays deliveries and strains local trucking capacity.
Fuel Reserves Seemingly Low
The Energy Information Administration (EIA) reported on Oct. 14th that the U.S. had only 25 days worth of diesel fuel in reserve and the White House is monitoring the supply, along with working to increase fuel reserves.
The national average price for a gallon of diesel was $5.309 on Monday morning, down slightly from last week but significantly up from last month’s average price of $4.876.
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