Diesel cost to rise significantly. Ouch!

Current Affairs / World Mission

Salon.com News | Fueling our pain:

“Oct. 11, 2005 | If Americans are hurting from $3 gasoline, wait till they feel the pain of $4, or even $5, diesel fuel.

We’d better get ready, because it’s probably on the way.”

Ouch, Ouch, Ouch. I’ve been wondering when the other shoe was going to drop. The problem we have at the moment is not that we don’t have enough crude, it’s that we don’t have enough refined product. A diesel shortage is going to hammer the trucking industry. That in turn is going to hammer the big warehouse stores like Walmart, Best-Buy, BJ’s, etc. They are all about moving product from manufacturer to consumer at nearly negligible transportation cost. The business model isn’t sustainable as costs for energy increase.

What about cargo ships? What do they use? Ouch. No more cheap products imported from overseas in time for Christmas.

The only silver lining I can see is that this energy bump is going to make it more viable for small manufacturing plants to re-open on US soil. (Now if we can just get a handle on employee health-care costs we might be able to jump start the rust belt again…)

(Via Salon.)

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