Bloomberg: US will face the risk of a shortage of gasoline in the summer due to EU sanctions
Gasoline shortages threaten the US East Coast this coming summer writes Bloomberg. The reason for this will be a possible reduction in reserve supplies from Europe after the entry into force of the EU embargo on imports of petroleum products from Russia, adopted under the sixth package of sanctions.
U.S. gasoline inventories are at their lowest level in 10 years and there is a risk they will continue to decline due to heavy winter maintenance at refineries in the country. Therefore, in the summer of 2023, many states, including New York, will be especially dependent on transatlantic supplies from the EU.
However, in the context of the cessation of fuel supplies from Russia, European refineries will be overloaded, which will complicate the situation with exports. A shortage could trigger price increases, leading to a repeat of the summer of 2022, when gasoline was sold at $5 per gallon (92 rubles per liter).
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The US is a major exporter of petroleum products, but the main storage facilities are in the Gulf of Mexico. Supplies from there to the east coast are limited by pipeline capacity. According to the agency, this problem can be solved by supplying petroleum products from storage facilities in the Gulf of Mexico to Caribbean countries, for example, to the Bahamas, and then exporting fuel from there to those states where there is a shortage.
Another option could be an increase in imports from Asia and the Middle East. However, due to high transportation costs, this option is unlikely to provide immediate or significant relief to US consumers.
According to auto club AAA on January 29, the average price of gasoline in the US is $3.51 per gallon (66 rubles per liter). Since Christmas, they’re up 40 cents a gallon. In March, the transition to more expensive summer gasoline will begin, which may again lead to an increase in prices.
The EU embargo on the import of Russian oil products will come into force on 5 February. Against this background, the cost of gasoline in Russia fell to multi-year lows due to the risk of lower demand. In turn, Europe is already looking for a replacement for Russian supplies, and one of the alternatives could be the import of diesel fuel from India.
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