How Much Diesel Is Left? Shortage Fears as East Coast Supplies 'Very Low'

Diesel prices remain high across the U.S. and inventory levels are lower than they have historically been this time of the year, as temperatures drop and demand grows.

As of the week ending on November 4, the U.S. had 106.263 million barrels left in stock, the equivalent of 26 days of supply according to the Energy Information Administration (EIA). That means that, in the unlikely scenario in which all U.S. refineries across the country were to suddenly shut down, the country would have enough diesel to cover 26 days.

The latest data shared by the EIA shows that diesel inventories have been slightly replenished compared to a month ago, when news that the U.S. had 25.4 days of supply left—the lowest level since 2008—triggered analysts to warn about surging diesel prices and led conservative host Tucker Carlson to falsely claim that the U.S. would run out of diesel entirely by Thanksgiving.

As of the week ending on October 21, the U.S. had 25.9 days left of diesel supply, and as of the week ending on October 28, 25.8 days.

"Supplies have not moved much over the past month," Denton Cinquegrana, chief oil analyst at the agency Oil Price Information Service (OPIS), told Newsweek.

"Over the past month totals were about 106.1-106.8 million barrels [...] so no real change of consequence. The East Coast is the main issue, supplies are very low there."

The data, as the EIA previously explained to Newsweek, are "only a measurement of the amount of distillate fuel in storage," which does not include the amount of distillate fuel being produced at U.S refineries or the amount of distillate fuel imported into the country—meaning the country can concretely rely on more diesel than just what is in storage.

But a look at the inventory levels for distillate fuels—which include diesel—in the U.S. over the last 30 years offers an idea of how low current diesel supplies are compared to past weekly averages.

In 2020, when the pandemic hit the U.S, levels reached a peak of 54.3 days of weekly distillate fuel supply as of the week ending on June 12, according to data available on the EIA's website. Lower levels of supplies than now were reached in 1996 (24.4 days left) and 2003 (21.8 days left), but stocks were gradually and consistently increased in the following weeks.

But if we compare current stocks with 2021 levels, there's a clear drop: as of the week ending on November 5, 2021, the country had 30.9 days of distillate fuels left in storage, 4.9 days more than the same time of the year in 2022.

The current diesel supply crunch stems from a combination of reduced capacity—as many refineries shut down or have repurposed their production since 2020, partially due to COVID-19— the ban on Russian imports after Moscow's invasion of Ukraine and increased demand as the economy quickly picked up after the pandemic.

Amid the current shortage, the price of diesel has remained high, at a national average price of $5.313 per gallon as of November 14—not much lower than this year's peak of $5.703 a gallon in June. Analysts are concerned that lower temperatures this winter might increase demand for diesel to heat homes, as is usually the case, which would cause diesel prices to rise again.

"The reason why diesel is now all of a sudden more expensive is that the calendar is trending colder weather months, and there are plenty of homes still using heating oil," Cinquegrana said.

The high-price diesel situation could change once the U.S. receives the cargo ships that were diverted from Europe in October. This should deliver to the country one million barrels of diesel. According to a Reuters report on October 14, at least two ships carrying a total of some 90,000 metric tons of diesel and jet fuel were diverted from their original destinations in Europe to the East Coast.

"In the current high-price environment, I would anticipate the motivation of foreign cargos to start landing over the next couple of weeks," Cinquegrana said. "That should help, especially if the remainder of November and early December have some mild weather days."