US diesel fuel exports climbed to an all-time high last week, a development that industry watchers say could tighten domestic supply and push fuel costs higher for trucking fleets heading into the fall and winter months.
According to Energy Information Administration data, the United States shipped diesel fuel abroad at a rate of 1.9 million barrels a day last week, topping the previous record set earlier this year. At the same time, domestic diesel production and inventories both declined. US diesel stockpiles now sit roughly 12% below their five-year average, the lowest seasonal level in nearly three decades.
Most of the exported fuel is heading to Europe, where refinery declines and an energy crunch tied to overseas supply disruptions have left buyers scrambling for diesel. US exports have held above 1.5 million barrels a day for five straight weeks before jumping to the latest record, according to a Bloomberg analysis of the EIA figures, forcing domestic suppliers to draw down reserves rather than build them.
The timing is a concern for fleets and other diesel-dependent businesses because refinery maintenance season, which typically runs from August through October, is approaching just as inventories are already thin. Diesel is also the primary feedstock for heating oil used across parts of the country in winter, meaning demand for the fuel is likely to climb in the coming months even as production capacity is temporarily reduced for scheduled maintenance work.
For trucking companies, tighter diesel supply and a shrinking cushion of reserves typically translate into higher and more volatile per-gallon costs, a factor that fleets already navigating elevated freight rates and driver capacity constraints will need to watch closely in coming weeks.
Source: OilPrice.com -- https://oilprice.com/Latest-Energy-News/World-News/US-Diesel-Exports-Hit-Record-High-as-Domestic-Stockpiles-Slide.html