We are about a month away from total havoc.
We were also a month away from no more diesel fuel about a month ago, and the month before, and the month before. This is simply how the lead-time for diesel fuel works. Allow us to explain.
Production Vs. Consumption
In general, fuels of all types are produced at a rate similar to which it is consumed, plus or minus a few percentage points. As such, the amount the United States economy has in storage will fluctuate in tandem with this number.
You may have heard recently in the news that the United States has about 26 days worth of diesel fuel left. While this is the lowest it has been in history, and does lead to higher diesel prices, it is far from a prelude to the Walking Dead where we will be stealing fuel from one another, sometimes by force.
The number for “days of diesel fuel left” is taken by dividing inventory by consumption per day. The statistic only shows what happens if every refinery in the nation just stopped at the same time. Instead, diesel refineries are currently producing less than what is consumed, but only at an incremental rate. Considering diesel fuel has a shelf life of relatively a year, it is for the best that diesel quickly goes from production to consumption.
The statistic is quite misleading: even if we lost one day of inventory per month, the United States would last until 2025, when Biden’s first term is over.
While it is an over-exaggeration to say there is a diesel shortage, truckers are certainly feeling the pain at the pump. Hopefully, things can turn around soon in regard to diesel refining so that the trucking industry can once again see prices that are more reasonable. Until that time comes, we recommend that you drive fifty-five miles per hour to get the most distance for your gallon.
Oftentimes we report about the current nationwide prices for gasoline and diesel. If there are any radical changes in prices, we will be sure to let you know.
ABOUT TOPMARK FUNDING
TopMark Funding is a top-rated semi-truck financing and trailer financing company located in Roseville, CA. We specialize in commercial trucking and heavy equipment. Our mission is to become your long-term financial partner by helping you grow your trucking business and fleet.
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