Where Has All The Diesel Gone? Long Time Passing…

For anyone who isn’t aware of it, there’s a growing shortage of “Diesel Fuel”.

In quotes because some other fuels are made using the same or similar parts of the crude oil feed. From home heating oil (also a #2 oil, but less well filtered), to #1 oil AKA Kerosene, jet fuel, lamp oil, and winter Diesel. Yes, a bunch of detailed specifications vary a little between all of those. Jet fuel has fewer things that form a waxy deposit if very cold as it gets very cold at high altitude. Also most ring compounds are catalytic opened to reduce smoke. Lamp oil is a bit heavier with fewer light ends so it doesn’t evaporate out of lanterns as much.

But they all start as the part of crude oil heavier (longer chains) than gasoline and lighter (shorter chains) than lubricating oils. Essentially, a barrel of crude has some natural gasoline, light oils, heavier oils, and tars in it. Refineries separate these, polish the molecular mix for specific properties, and ship out the products.

With some special gear (cat crackers / reformers), you can change how much of each you get by a modest degree; and at more cost with some loss of total energy available. (That is, running a hot refinery uses up some energy at each step). So there are practical limits to how much vs efficiency.

In the USA, we have mostly gasoline cars. The average refinery run makes a little too much Diesel compared to the gasoline desired. In Europe, many cars are Diesels. So many that, added to the trucking and ship demand, the typical refinery run makes too much gasoline compared to the Diesel demand. To balance things out, the USA ships some Diesel to Europe and they ship excess gasoline here.

Enter the European embargo on Russian Oil…

Suddenly they need a LOT of Diesel to replace what they were getting from Russia.

So Biden & Co. decide to ship a bunch more of our Diesel to them. Jacking up prices and causing shortages here. All to spit at Russia.

https://fortune.com/2022/05/17/diesel-prices-threaten-inflation-us-infrastructure/

Runaway diesel prices threaten to do a lot more than make inflation worse—American infrastructure is at stake
BY
TRISTAN BOVE
May 17, 2022 12:58 PM EDT
High gasoline prices are hitting Americans hard, with the national gas price average sitting at $4.48 per gallon on Monday, up nearly $1.50 from a year ago.

But it’s even worse for drivers who rely on diesel fuel.

The national U.S. average price for diesel is now $5.56, its highest on record. In the U.K. diesel prices are now over £1.80 a liter, a record high for that country.

The average driver in the U.S. doesn’t rely on diesel, as it’s commonly used by truck drivers and heavy farming vehicles. But sky-high diesel prices could not only aggravate an inflation problem that is already hurting U.S. consumers—they could have dire implications for U.S. infrastructure, and the fate of the global supply chain.
[…]
Everything from trucks and trains to farming and construction equipment tend to rely on diesel rather than regular gasoline. Around 75% of all commercial vehicles registered in the U.S. are powered by diesel, as are the vast majority of both large and medium-sized long-haul trucks.

These are the same trucks that carry food and most other products around the U.S., and as diesel prices surge everywhere, signs are emerging that this infrastructure is beginning to break down.

Global consequences
The U.S. supply chain infrastructure is heavily reliant on diesel, and high prices for the fuel are starting to wear it down as trucking companies struggle to deal with the expenses.

But it’s not just the U.S.—the diesel price surge is a global problem, and right now, there simply isn’t enough to go around.

While the diesel problem is hitting U.S. truck drivers hard, Europe is bearing the brunt of the price surge, as almost half of European passenger cars run on diesel, as well as all trucks and freight trains.

Prior to Russia’s invasion of Ukraine, Europe imported roughly two-thirds of all its external crude oil, which is refined to make diesel, from Russia. These imports are beginning to be drawn down, and European countries are turning to higher imports from the U.S. to satisfy the supply gap.

The U.S. is shipping more diesel to Europe than it has in years, fuel which would have otherwise gone to resupply truck stops.
[…]
Helping Europe minimize the impact of its diesel shortage is crucial to bringing global prices down, but shipping more of the fuel abroad means that U.S. truck operators are in for a shortage of their own.

Currently running about $1/gallon more than gasoline when historically it was close to parity. About $3/gallon more than when Trump was in charge and oil was promoted instead of vilified.

https://www.eia.gov/energyexplained/diesel-fuel/use-of-diesel.php

In 2020, distillate fuel consumption by the U.S. transportation sector, which is essentially diesel fuel, was about 44.61 billion gallons (1.06 billion barrels), an average of about 122 million gallons per day. This amount accounted for 77% of total U.S. distillate consumption, 16% of total U.S. petroleum consumption, and on an energy content basis, about 27% of total energy consumption by the U.S. transportation sector.

So that’s about $44 billion added cost to everyone in the USA just from the Russian Embargo JUST in Diesel fuel, and $88 Billion from the Biden anti-oil policies. $132 Billion combined. Per Year. I make that about $400 per person. $1600 for a family of 4. Don’t drive a Diesel? You still pay it in higher prices for everything hauled in trucks, ships & trains.

Now figure the impact from higher gasoline prices and jet fuel… 16% Diesel… so 84% in other stuff. As a first approximation, call it 84/16= 5.25 times. Call it just 5x. $2000 per head. ($2400 Total) Or $8000 for a family of 4. ($9600 total) How many families have a spare $10 Grand PER YEAR kicking around to toss at Biden Oil Policies & Russian Embargo politics?

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