I’ve been warning about the spike in diesel prices, followed by shortages of supply, for several weeks now. Especially if Trump goes along with an export ban. A third of the diesel we import is from America, which is the world’s biggest diesel exporter (1.5m b/d). There are no alternative sources of supply. A US export ban would throw us into recession by Christmas. The economy, from farm machinery to road haulage, is powered by diesel.
The UK currently holds only 42 days of diesel in its emergency stockpiles. While the UK stands at just 42 days, countries like Italy hold 347 days, the USA has 677 days and Canada and Japan maintain over 1,000 days of supply.
In the early 2000s, Britain held over 100 days of diesel reserves. However, as major domestic oil refineries closed down over the years, the country's massive storage tanks disappeared with them, leaving the UK heavily reliant on just-in-time imports.
That is the jeopardy facing every supermarket shelf, every hospital delivery, every harvest, every bin collection and every freight train that still keeps Britain functioning. And the system that supplies that fuel security has been allowed to grow dangerously thin.
Meanwhile the UK’s ability to make that fuel itself has been dismantled. From eighteen refineries in the 1970s to nine at the turn of the century, Britain is now down to just four: Domestic demand already exceeded refining capacity before those closures. The gap is filled by imports - more than half of the diesel that goes into British tanks.
This has happened through a long succession of terrible government choices and neglect that treated energy security as an afterthought. Carbon costs were loaded onto plants that operate here, while higher-carbon fuel could be imported without equivalent burden. Almost every government over the past 20 years helped to create this looming crisis.
Diesel is the engine room of the economy. And successive governments have allowed the tanks to run towards empty.
Shameful.