Low fuel supplies cause special concern in the US Northeast

PORTLAND, Maine — Stocks of diesel and heating oil in the northeast are more than 50% below the recent average, raising concerns that an extreme weather event could cause supply disruptions, federal officials said.

Fuel supplies are lower than normal across the country for several reasons, including the war in Ukraine. But it’s the worst in the northeast.

According to a study by the Department of Energy, diesel fuel and heating oil, which make up the distillate category, are 63% below the five-year average in New England and 58% below the same average from Maryland to New York. Gasoline inventories aren’t that bad, but are still at their lowest levels in nearly a decade along the entire East Coast, the agency said.

The Northeast relies heavily on heating oil to keep homes warm in the winter, while other regions rely more on natural gas and electricity. Also, the National Oceanic and Atmospheric Administration has forecast an active hurricane season and a strong weather event could cause disruptions as most of the fuel consumed from the Mid-Atlantic states to Maine comes from refineries on the Gulf Coast, energy officials say.

Secretary of Energy Jennifer Granholm calls a meeting of New England governors and their energy directors after Labor Day to discuss the situation. In the meantime, she has written a letter to the governors urging them to take all possible steps to maintain fuel supplies over the coming weeks to avoid any problems.

The Energy Department also sent letters to seven major oil companies asking them to hold their stocks to compensate for low inventories.

The federal agency has been monitoring the issue and is trying to be proactive with outreach. But there’s little incentive for buyers to stock up on expensive fuel for storage as prices are expected to fall, said Michael Ferrante of the Massachusetts Energy Marketers Association.

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The fuel supply concerns come against the backdrop of Russia’s invasion of Ukraine that further shook up an energy supply chain trying to catch up with growing demand. The war raises concerns about the adequacy of energy supplies around the world.

In New England, the immediate concern in late summer is diesel fuel, but the winter heating season isn’t far off.

Fuel oil disruptions would hit the region hard, as the percentage of homes dependent on it ranges from 24% in Massachusetts to over 60% in Maine, its most dependent states.

Maine Governor Janet Mills, a Democrat, has urged the Energy Department to expedite its meeting with governors to discuss maintaining a stable supply of fuel oil.

Maine is “clearly vulnerable to the increased prices and volatility the global fossil fuel market is now experiencing as a result of the Russian invasion of Ukraine,” said Anthony Ronzio, a spokesman for the Mills administration.

Despite the concerns, wholesale suppliers and retailers are working well together, and Ferrante said he expects inventories to increase in September and October, allaying immediate concerns.

He said he is optimistic that there will be an ample supply of fuel oil.

“Retail suppliers and delivery companies are concerned about prices and inventory, but no alarm bells are ringing at the moment,” he said. “I don’t see a crisis at the moment.”

The Energy Department has created a fuel oil reserve containing 1 million barrels in terminals in the northeast. They can be overheard in an emergency.


Follow David Sharp on Twitter @David—Sharp—AP

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