Threat of diesel shortage looms as reserves dwindle
Diesel supplies are at their lowest level since 2008
The Biden administration says it is keeping a close watch on diesel inventories and working to boost supplies following news that reserves have been depleted and could run out in less than a month if not replenished, sparking fears of shortages and rising prices.
The Energy Information Administration (EIA) reported this week that, as of Oct. 14, the U.S. had only 25 days of reserve diesel supply, a low not seen since 2008. National Economic Council Director Brian Deese acknowledged to Bloomberg that the level is "unacceptably low," and "all options are on the table" to address the situation.
White House National Economic Council Director Brian Deese acknowledged this week that diesel inventories are "unacceptably low." (Anna Moneymaker/Getty Images / Getty Images)
The EIA also said that distillate fuel includes heating oil inventories and is about 20% below the five-year average for this time of year. But areas in the Northeast are already rationing heating oil as temperatures drop, driving concerns that energy costs will surge further.
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A White House official told FOX Business the administration is closely monitoring diesel inventory levels, especially on the East Coast, and that it is in touch with U.S. energy firms regarding the need to build up reserves and drive toward solutions.
Diesel and heating oil inventories are down for the Northeast from Maine to Maryland. (iStock / iStock)
The official added that the administration has also been in regular communication with East Coast governors for months and has readied tools at its disposal, including the Northeast Home Heating Oil Reserve (NEHHOR).
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The NEHHOR holds roughly 1 million barrels of home heating oil, and House Democrats from New England are asking President Biden to release some of those reserves to help reduce home heating prices in the region leading into the winter months.
An aerial view of the Phillips 66 oil refinery in Linden, N.J., May 11, 2022. (Tayfun Coskun/Anadolu Agency via Getty Images / Getty Images)
But experts say the developing home heating oil shortage is not going away anytime soon.
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Patrick De Haan, GasBuddy's head of petroleum analysis, told "Varney & Co" that viewers can expect to hear "a lot more" about refineries struggling to keep up with rising demand this winter.
FOX Business' Edward Lawrence, Jacqui Heinrich and Taylor Penley contributed to this report.