New data from the Energy Information Administration (EIA) highlights the costly potentiality surrounding the depleting supply of diesel fuel in the United States. The fuel shortage has been building over time. However, recent events have accelerated the issue. Since last year alone, the price of diesel fuel has risen 35%.
An energy expert from GasBuddy, Patrick De Haan, told CBS News that recent events such as, “Russia’s war on Ukraine, refinery shutdowns due to COVID-19 and Hurricane Ida and a fire explosion at a Philadelphia refinery back in 2019 have all contributed to reduced refining capacity...”
According to EIA data compiled by Reuters, October 21st marked the lowest reserve of diesel fuel for that time of year since 1982. Reports also suggest that there could be less than a month's supply of fuel remaining as the construction industry continues to pay the price in inflated costs.
“Fuel surcharges are common now, and there’s typically a separate line for delivery charges that are adjusted according to the change in price,” says Ken Simonson, chief economist for the Associated General Contractors of America (AGC). Simonson Added that every increase in the per gallon price of diesel fuel has the potential to lead to increased delivery fees on materials.
It is reported that 98% of all construction involves diesel energy. The fuel is used for heavy equipment, vehicles used in hauling materials, company trucks etc... As diesel fuel stocks dry up, overhead for contractors may skyrocket; the supply chain will suffer delays, and material prices will increase.
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