Are We Sleepwalking into a Diesel Shortage?
11 days ago
- #geopolitics
- #economic-decline
- #energy-crisis
- The article discusses a looming diesel shortage, highlighting rising diesel prices despite flat global demand and an oversupply of crude oil.
- Diesel is crucial for agriculture, mining, military, and transportation, making its shortage a significant threat to the economy.
- Refineries face constraints in producing diesel due to the specific types of crude oil required and limited refinery flexibility.
- The 'crack spread' metric indicates diesel shortages when elevated, currently showing persistent high levels.
- Global diesel consumption plateaued in 2015, signaling stagnant economic growth rather than a shift to alternative energy sources.
- Conventional oil production peaked in 2005, and suitable crude for diesel is becoming scarcer, masked by shale oil and other substitutes.
- Russia's invasion of Ukraine exacerbated diesel shortages by disrupting medium-heavy crude supplies to European refineries.
- Sanctions and tariffs, like those on Russian oil and US steel imports, have further strained diesel production and refinery operations.
- Economic decline in the West, particularly in the EU and US, is reducing diesel demand but not solving the underlying supply constraints.
- The article warns of a future where diesel becomes increasingly unaffordable, leading to economic and geopolitical instability.
- China and the US are preparing for resource conflicts, with China stockpiling oil and the US securing oil infrastructure.
- Historical parallels suggest that economic embargoes and resource shortages can lead to unpredictable and aggressive actions by affected nations.
- The article concludes that the diesel crisis is a symptom of the broader decline of the oil age, with severe consequences for global stability.