Diesel shortage will not be rationing, Promise No.10

The government has dismissed fears of diesel rationing after some of the world’s largest commodity traders suggested that Europe could face a supply shortage.

Whittle yesterday warned of a “systematic shortage of diesel” and said fuel rationing was a “possibility” due to supply disruptions from Russia.

Russia is the world’s largest exporter of oil and oil products, exporting about 5 million barrels of crude oil per day and 3 million fuels such as diesel.

The International Atomic Energy Agency (IAEA) says Russia’s crude exports could fall by 1.5 million barrels a day from next month, while exports of fuel and other commodities could fall by 1 million barrels a day due to a combination of formal US sanctions and a wider boycott. Russian power by Western companies.

About 18 per cent of the UK’s diesel imports, or one-third of its diesel imports, come from Russia. Britain has promised to stop buying Russian oil and oil products by the end of this year.

Diesel prices have already reached a record high of around 179p per liter as oil and fuel prices have risen amid fears of a shortage.

“Everyone’s concerned about the supply of diesel,” said Russell Hardy, chief executive of the product giant, at a Financial Times event. “The supply of diesel in Europe is of great concern, as half of the imports come from Russia. . . Diesel rationing is a possibility. “

Jeremy Weir, chief executive of Trafigura, said at the event that the diesel market was “extremely tense” and “going to be tough”, while Gonbore co-founder Torbjorn Tornkvist said: “Diesel is not just a European problem, it’s a global problem. It really is.”

An official spokesman said last night: “It is completely untrue to suggest that we have any motive for diesel rationing. In this year’s course, our Russian oil phase-out is designed to allow enough time to adjust the supply chain. “

However, Vital is not the only company that warns of the possibility of rationing as Russian supply bans and boycotts lead to global shortages and competition for supplies from elsewhere.

Amrita Sen, director of research at Energy Aspects, a consultancy, told MPs last month that Germany could face rationing later this month, as BP and Shell have already cut diesel sales to wholesale customers. He suggested that the UK could also face rationing because refineries may not be able to supply and their output may have to be reduced.

The UK government has said it will work with companies through a new oil-related task force to help them find alternative supplies.

The UK Petroleum Industry Association has previously said: “Fuel suppliers are working with the government to supply the UK with essential fuels while adjusting long-term supply routes to reduce Russia’s dependence on crude oil and oil products.

“The global market has historically been able to adjust to ensure secure supply and we hope it will happen again.”

Hardy also warned yesterday that “the longer the war lasts, the greater the potential for economic recession.”

Traders have also warned of disruptions in the gas market as companies struggle to meet margin calls.

Hardy said: “The gas market is more worrying than oil. It’s important for regulators to keep equipment in their back pockets in the event of a gas market crisis. “

The European Federation of Energy Traders warned last week that a number of “generally sound … energy companies” were at risk of failing to meet strong margin calls due to extreme market conditions and called on central banks or governments to “ensure that wholesale energy markets continue to operate.” -Limited emergency liquidity assistance “requested.

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