(by Michael Snyder | The Economic Collapse Blog) – What I am about to share with you is a developing situation, and I hope to share more once the facts become clearer. It appears that a very serious diesel crisis is coming in the months ahead, and that will have a dramatic impact on our economy. As you will see below, we are being warned that there will be shortages of diesel fuel, diesel exhaust fluid and diesel engine oil. Most diesel vehicles require all three in order to run, and so a serious shortage of any of them would be a major disaster. Needless to say, simultaneous shortages of all three could potentially be catastrophic. Most Americans don’t spend much time thinking about diesel, but without it our supply chains collapse and we don’t have a functioning economy. In a recent Time Magazine article discussing the coming diesel fuel shortage, we are told that “the U.S. economy runs on diesel”…
Though most consumers shake their heads at the cost of gasoline and complain about the cost of filling up their car tanks, what they really should be worried about is the price of diesel. The U.S. economy runs on diesel. It’s what powers the container ships that bring goods from Asia and the trucks that collect goods from the ports and bring them to warehouses and then to your home. The farmers who grow the food you eat put diesel in their tractors to plow the fields, and the workers that bring construction equipment to build your home put diesel in their trucks.
Since January, supplies of diesel fuel have been steadily getting tighter.
As supplies have gotten tighter, prices have skyrocketed. The average price of a gallon of diesel fuel hit $5.50 a gallon in early May, and it has remained above that level ever since.
One of the biggest reasons for the supply crunch is a serious lack of refining capacity. Back in 1980, the U.S. had twice as many refineries…
There are also fewer refineries, which process crude oil into diesel and other products, in the U.S. than were just a few years ago. There are just 124 now operating, down from twice as many in 1980, and down from 139 in 2016, according to the U.S. Energy Information Association. The northeast region is particularly spare, with just seven refineries today, down from 27 in 1982.
There have already been some temporary outages of diesel fuel at a few locations around the country, and we are being warned that disruptions are likely to intensify during the summer months.
But the good news is that we aren’t going to run out of diesel fuel. It may become a lot more expensive, and there may be painful temporary shortages, but we won’t run out of it.
Unfortunately, the crisis that we are facing with diesel exhaust fluid is potentially much more serious.
If you have just been skimming this article, this is the part where you need to start really paying attention.
Newsweek is telling us that the United States “could soon experience a severe shortage of diesel exhaust fluid”…
The U.S. could soon experience a severe shortage of diesel exhaust fluid (DEF), impacting U.S. drivers already hit with soaring fuel prices.
DEF is a solution made up of urea and de-ionized water that is needed for almost everything that runs on diesel. It reduces harmful gases being released into the atmosphere and works by converting nitrogen oxide produced by diesel engines into nitrogen and steam.
If you have a diesel vehicle that was sold in the United States after 2010, your vehicle could technically run without DEF, but in most cases your vehicle will simply not let you start it if the DEF tank is dry…
Can we call it a DEF jam? Everything is in short supply as supply chains continue to unlink. The latest commodity reportedly hit is DEF, or the blue diesel exhaust fluid that every diesel sold in the U.S. after 2010 needs to cut emissions. This means that every diesel truck, diesel RV, SUV, and car owner will likely have to look harder, and pay more for, DEF. A diesel engine can technically run without DEF, but your diesel vehicle likely won’t let you start it if the DEF tank is empty.
A lack of urea is the biggest reason for the growing shortage of DEF.
The United States is one of the largest importers of urea in the world, and Russia and China are two of the largest exporters. In previous years that wasn’t a problem, but now the war in Ukraine has dramatically changed things…
A major portion of our urea comes from Europe, and because of the war in Ukraine we’re seeing a shortage of it, according to Newsweek. Russia is one of the world’s major exporters of it. China, too, is a major exporter of it, and it has suspended exports. Weather, too, has caused supply chain disruptions. Since it’s also a major component in fertilizers, there’s intense competition for urea.
Without enough DEF, our economy is going to be in for a world of hurt.
Meanwhile, Mike Adams is reporting on the growing shortages of diesel engine oil that are starting to happen all over the nation…
Retailers, customers and distributors are all reporting shortages in diesel engine oil. This is not an imaginary problem, it is a real problem that is so far entirely ignored by the corporate media.
Apparently there are some diesel engine oil additives that are in extremely short supply, and one industry insider is telling us that this problem isn’t going to be resolved any time soon.
So what this means is that people are going to start running out of diesel engine oil.
In fact, it is already being reported that the trains in Sri Lanka will soon have to completely shut down because of a lack of diesel engine oil…
Sri Lanka Railways said that it will NOT be possible to operate trains in the future due to the lack of engine oil. A senior official at Sri Lanka Railways said that the current level of engine oil would only last for another two months.
That’s in line with the warning we’re hearing in the states: About 8 weeks of diesel engine oil remaining in the pipeline.
Just solving one of the shortages that I have described in this article will not be enough.
As I noted in the opening paragraph, a diesel vehicle requires diesel fuel, diesel exhaust fluid and diesel engine oil in order to operate.
You need all three.
This is a story that I will be following very closely. Needless to say, there are enormous implications for our supply chains and for our economy as a whole if solutions cannot be found.