Current Diesel Fuel Shortage Worse Than 1970s Fuel Crisis, Will Accelerate Potential Food Supply Catastrophe

As we have reported, dozens of food processing plants have either exploded or caught on fire recently, and barns across the US have been ‘spontaneously’ bursting into flames at the highest rate in recorded history.

Moreover, tens of millions of chickens have been exterminated since November of last year, and the European pork and cattle supply has been recently affected by diseases like Japanese Encephalitis and Foot-and-mouth disease.

If this wasn’t bad enough, the baby formula supply in the US has been critically low following a major processing plant being shut down by the FDA, while exports of wheat have been halted by the largest wheat producers in the world due to low supply.

Over the past few months, the global food supply has been spiraling toward disaster, and these latest events are being labeled by many pundits as a ‘deliberate attack‘ on our already vulnerable food supply.

To make matters worse, it is now being reported that truckers are becoming increasingly concerned over the severe diesel fuel shortage which may cause a devastating impact on the delivery of food there’s already a shortage of.

According to industry experts, the East Coast of the U.S. is reporting its lowest seasonal diesel inventory on record, and the shortage is about to cripple an already fragile supply chain.

“We’re really headed for a bad situation if we can’t get this fixed,” Joe Cain, a truck driver told WBAL-TV 11 News. “As an owner-operator, you might have to stop driving at all, or go work for something else. We don’t know, we might all be on unemployment.”

According to trade publications, diesel supplies on the East Coast are now the lowest in almost 20 years. Truck associations say with diesel fuel now surpassing labor as the industry’s No. 1 expense, the coming fuel shortages could be devastating.

“If we don’t have diesel, then we can’t run,” Louis Campion, president, and CEO of the Maryland Motor Truck Association told WBAL-TV 11 News. “It’s giving them concern, that’s certainly giving us a lot of concern about the potential and ability to purchase fuel at the pump or rationing on fuel or anything that could occur.”

The typical East Coast storage is around 62 million barrels of diesel during the month of May, but as of last Friday according to the Department of Energy, the region is reporting under 52 million barrels. 

The sharp increase in the cost of diesel has stressed an already fragile trucking industry since the beginning of 2022, and according to figures, the price has reached a record high at $5.62 per gallon.

The East Coast average of $5.90 per gallon is up 63% from the beginning of this year. 

Our industrial and transportation networks are heavily reliant on diesel fuel, and more expensive diesel means the price of everything will increase more than it already has. Trucks, trains, and barges also consume about 122 million gallons of diesel per day.

An executive at fuel price site GasBuddy, Patrick DeHaan, recently reported that retail truck stops have begun hauling large amounts of fuel from the Great Lakes to the Northeast.

According to Market Watch, two of the largest truck stop chains said they are closely monitoring low diesel fuel inventory in the Northeast amid growing concerns of industry-wide shortages.

They noted that currently, they have no plans to restrict purchases, but hinted this could be a possibility.

The widespread shutdown of refineries across the US over the past 15 years doesn’t exactly help the situation either. Bloomberg’s Javier Blas recently reported that the east coast has lost over half of its refineries since 2007.

“In the past 15 years, the number of refineries on the U.S. East Coast has halved to just seven. The closures have reduced the region’s oil processing capacity to just 818,000 barrels per day, down from 1.64 million barrels per day in 2009. Regional oil demand, however, is stronger,” Blas wrote.

The recession of 2008 led to the shutdown of some east coast refineries, but most of the recent shutdowns, like the shuttering of a major Philadelphia refinery, were due to regulations and compression of margins.

Gas prices have been surging for a while now, but according to Insider, diesel is in its worst crisis since the 1970s, and localized rationing may be making a comeback soon. Many Americans today are far too young to recall the fuel shortages in 1970s America, but the crisis sparked mayhem in the streets and quite literally forever changed the nation.

“We’ve seen this dance before,” writes historian Meg Jacobs, author of Panic at the Pump. “If you are of a certain age, you surely recall sitting in the back of your family’s station wagon waiting hours on end in the 1970s to get a gallon of gas.”

The first of the 1970s fuel panics began in 1973 after the Organization of Petroleum Exporting Countries (OPEC) raised the price of oil by 70 percent. This, coupled with the US embargo — which led to a 400% increase in the price of oil — sparked the 1970s crisis, and threw the world’s economy into a sharp recession within a matter of days.

The crisis affected everything from home heating to many other business costs that were passed on to consumers in just about every industry. The impact though, was most obvious on the roads, as mayhem in the streets caught on almost immediately.

According to the NPR, gas station lines wrapped around blocks, with some stations posting green flags if they had gas, and red if they didn’t. Many of the gas stations were using odd-even rationing at the time as well: If the last digit of a car’s license plate was odd, it could only fill up on odd-numbered days.

By February 1974, drivers in some parts of the country were waiting in more than five-mile lines. Fights were regularly breaking out on the road and at gas stations, and some station owners began carrying guns for protection.

“It’s turning us into animals,” John Wanken of Cockeysville told the Baltimore Sun at the time. “It’s back to the cavemen.” Wanken also said he once spent a whole morning driving around the city looking for gas but only managed to buy $2 worth, which was just enough to replenish the amount of fuel he burned driving around looking for it.

While Americans today are reeling from the sticker shock of regular gas at the pump, the diesel market is in its worst crisis since the 1970s according to analysts.

The commodity allows much of the economy, including farm equipment and industrial machinery, to run, and prices have hit a record $5.56 per gallon, which is up 76.5% from a year ago. In New York, the situation is so bad that refinery and fuel magnate John Catsimatidis, implied recently that rationing like we experienced in the 1970s may soon begin.

In Europe, diesel prices have soared by 88%. The International Energy Agency reported recently that global stockpiles of refined oil have fallen to dangerously low levels, and the current shortages are already limiting transportation across various African nations.

The upcoming summer driving season will boost demand even further, and as pandemic measures wane, businesses are revamping operations and now requiring more energy use.

Not only have many refineries permanently been shut down, and others temporarily when demand was lower, but certain diesel-making regions such as California have converted refineries into biodiesel hubs to meet ‘climate targets.’

The war in Ukraine is also tightening diesel availability as Russian refineries aren’t pushing supplies into the European market due to bans and sanctions.

According to the Daily Mail, many US billionaires seem to know something most Americans don’t. “Soaring numbers of wealthy Americans are buying ‘golden passports’ that grant them citizenship to New Zealand, Portugal and other ‘safe’ countries over fears of impending civil war in their home country,” the Daily Mail writes.

“We’ve all lived through the past two and a half years… it all just reminded us how vulnerable and frail we are, and people who have means are accepting that it will happen again — and they don’t want to be caught off guard,” Reaz Jafri, a NY Lawyer told Insider.

Former Google CEO Eric Schmidt was one of the many billionaires seeking a ‘golden passport’ in 2020 as he applied for European citizenship through Cyprus’s program, which is now defunct.

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