After a significant increase in the cost of diesel fuel, the administration of Vice President Joe Biden is considering releasing a portion of a unique strategic reserve in order to alleviate the severe shortage of supplies.
Critics, on the other hand, believe that the move won’t amount to much and point to the pursuit of profits by businesses as the root reason for the scarcity. Production deficiencies are not to blame.
The release would come from the Northeast Home Heating Oil Reserve, which is a stockpile of ultra-low sulfur distillate (ULSD) diesel fuel with a capacity of one million barrels. The reserve was established in the year 2000 with the intention of ensuring that residents of the northeastern region of the country would always have access to heating oil.
Although the United States’ embargo of Russian petroleum products has not had a significant impact on the country’s supply of diesel fuel, the commencement of Russia’s military operation in Ukraine in February caused prices in Europe, which imports the vast majority of its diesel, to skyrocket. CNN reports that when US suppliers started transporting fuel over the Atlantic in order to capitalize on the price increase, it caused shortages in the US, which in turn pushed up prices in the US.
Emilie Simmons, a deputy press secretary for the White House, said on Twitter on Monday “we’re closely monitoring challenges to diesel supply and prices as a result of Putin’s invasion.”
We’re closely monitoring challenges to diesel supply and prices as a result of Putin’s invasion.— Emilie Simons (@EmilieSimons46) May 23, 2022
An emergency declaration has been prepared for @POTUS to authorize a release from reserves if necessary.
This would bridge short term supply shortfalls.https://t.co/SbX465Fe43
According to data provided by the American Automobile Association, the price of diesel fuel in the United States has reached an all-time average high, with prices averaging $5.58 per gallon across the country for the week of May 18. (AAA). This is a nine percent increase from the previous month and a seventy-five percent increase from a year earlier, as reported by AFP. Higher diesel prices are likely to translate into higher operational and, as a result, higher consumer costs; this is a key driver of the record-high inflation that is currently afflicting the United States. While the majority of American automobiles do not run on diesel, the majority of American trucks and locomotives do.
CNN was informed by Andy Lipow, president of Lipow Oil Associates, that the release wouldn’t achieve too much.
In comparison, the Biden administration issued an order in March to release a massive amount of oil from its Strategic Petroleum Reserve at the rate of one million barrels per day for a period of six months in an effort to slow the rapidly increasing prices of petroleum products. This was done because supply had been severely hampered by the boycott of Russian products.
The preceding is a summary of an article that originally appeared on InfoWars.