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“Green Energy” Dreams Causing Diesel, Gas and Heating Oil Shortages in U.S.
By: David Deschesne
Fort Fairfield Journal, November 16, 2022
The production of diesel continues to face challenges as the U.S. supply hovers between 25 to 27 days’ worth of the fuel on hand. According to the Energy Information Administration (EIA), as of October 21, 2022 there were 106.4 million barrels of diesel fuel all processed and ready for delivery. A week later, on October 28, that amount had only slightly increased to 106.8 million barrels. This is the lowest the diesel stocks have been in forty years.
The EIA reports that on October 28, 15.8 million barrels of crude were processed at U.S. refineries, which was 406,000 barrels per day more than the previous week’s average, with refineries operating at 90.6% capacity.
While claims of “pumping more oil” may help to alleviate the pricing problem by bringing down the overall price of crude oil by a nominal amount, the real problem is in the ability to refine the raw crude into useable fuels such as gasoline, home heating oil and diesel fuels. With the political impetus toward so-called “green energy” platforms such as wind and solar, investors are no longer interested in investing money in new refineries or even upgrading the older ones—some of which have been in service for more than 65 years.
Many refineries in the U.S. are simply closing down, further reducing the ability to process crude oil into useable fuels.
For example, a refinery in Gallup, New Mexico which processed 26,000 barrels of crude per day has closed down. Shell has closed their refinery in Convent, Louisiana. While they have plans to produce biodiesel and other fuel alternatives there in the future, the plant still remains idle. Phillips 66 has closed their massive Alliance refinery in Belle Chasse, Louisiana after damages from Hurricane Ida were too expensive to repair because of lack of interested investors.
Meanwhile, in Houston, Texas the Lyondell refinery, which processes up to a quarter of a million barrels of crude per day, is set to shut down in 2023 since the European owners are more interested in pursuing green energy alternatives. The closure of Lyondell will even further exacerbate the supply and pricing issues of diesel, heating oil and gasoline in the U.S. next winter.
The lack of interest by investors in oil refineries is due in large part to the political ruling class of the Democratic party which has been in power over the past two years at the federal level. Joe Biden, who is perpetually against anything fossil-fuel related, recently spoke at an event in California just days before the mid-term elections where he pledged to shut down all coal and oil plants in the U.S. While that was met with much applause and fanfare in the captured state of California, it doesn’t take into consideration that many people—and the entire transportation, travel and heating infrastructure—are decades away from converting to wind and solar—if those forms of energy will ever be viable replacements.
Closer to home, here in Maine, Democrat Governor Janet “Big Sister” Mills on her first days in office in 2018 divested all of the State’s investments from fossil fuel projects, such as drilling and refining, and she was able to convince several other Democratically-controlled states to follow her. This reduction in investments and confidence in a fuel industry that the U.S.—and world, for that matter—is still reliant on is one of the major reasons no new refineries are being built and the existing plants are not being maintained or repaired as needed.
While the kinks may be ironed out of the “green energy” problems sometime in the future, politicians and investors are prematurely pulling the plug on fossil fuels which will leave many people cold and destitute for years as the refinery supply chain problem continues to deteriorate.
