After more than a year of tumbling oil prices because of low demand during the pandemic, some energy market-watchers now say there could be a gasoline shortage this summer.
Matt Smith, director of commodity research at ClipperData, tells Texas Standard that the root of the problem isn’t an expected surge in road trips this summer because of an increase in vaccinations and an easing of COVID-19 restrictions nationwide. Instead, Smith says it’s because of a shortage of oil-tank truck drivers.
“A number of drivers left the business a year ago when gasoline demand cratered, you know, amid the pandemic lockdowns, and they’ve simply not returned because they found work elsewhere,” Smith said.
Smith says gas shortages aren’t guaranteed, but if they do happen, they would likely be sporadic and would occur in “vacation hot spots” where people are more likely to “panic buy” if they see gas supplies are limited.
After a brutal year for gasoline producers, Smith says this summer could be its “last hurrah” as more people continue to work and shop remotely, and as electric vehicles become more ubiquitous.
Highlights from this segment:
– The U.S. Energy Information Administration has said gasoline demand already peaked in 2018. Smith says the industry is now in a period of “structural decline” as driving culture changes, Smith says.
– Reinstated emissions rules from the Obama era will also help chip away at gasoline consumption. But Smith says the biggest shift will come when electric vehicles become more affordable.
– Fewer young people are driving these days, which is also affecting gasoline demand.