Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

New York Gasoline Shortage Brews on Fallout From EU’s Russia Ban

Published 31/01/2023, 02:46 am
Updated 31/01/2023, 02:46 am

(Bloomberg) -- New York and much of the East Coast are at risk of a gasoline shortage this summer as the European Union’s ban of Russian fuel threatens to choke off the backup supplies the US relies on during peak driving season.

Seasonal gasoline stockpiles already are at the lowest in about a decade, and heavy winter maintenance at refineries may further trim inventories. The EU ban on Russian oil-product imports starting Feb. 5 will strain the region’s feedstock supplies, limiting how much gasoline the bloc can make for itself or the US East Coast, which increasingly relies on transatlantic imports in the summer.

The price spike that would accompany such supply shocks threatens to burden consumers still stinging from last summer’s $5-a-gallon gas. Resurgent pump prices also would pose challenges for President Joe Biden, who has made a priority of capping fuel costs and uses prices as a cudgel against political rivals.

To prevent New York and the rest of the East Coast from running out of fuel, suppliers will need to get creative. Although the US is a net exporter of gasoline, most of the excess is in the Gulf Coast, and transportation to the East Coast is constrained by insufficient pipeline capacity and the expense of waterborne shipping.

Suppliers could move fuel from the Gulf Coast into storage and blending facilities in the Caribbean, such as in the Bahamas, and then export from there to the East Coast, according to Energy Aspects, a London-based consultancy. The US also may draw more supply from Asia and the Middle East, but the lengthy journey and high shipping costs mean that option isn’t likely to provide quick or significant relief at the pump.

 

 

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.