NASHVILLE, TENN. (RFD NEWS) — U.S. distillate inventories continue to tighten ahead of the fall harvest, keeping diesel costs a concern for farmers and rural businesses. Energy Information Administration data show distillate stocks fell again in mid-August and remain about 13 percent below the five-year average.
Crude oil supplies are less concerning. Commercial crude inventories increased during the week and remain near normal seasonal levels, while refineries operated at roughly 97 percent of capacity.
That distinction matters because diesel is only one of several products refiners make from crude oil. Strong diesel crack spreads — the difference between crude costs and the value of refined diesel — signal particularly strong demand or tight supply for the finished fuel.
Farmers face that pressure as harvest, trucking and machinery use increase. National retail diesel averaged about $5.45 per gallon in mid-August, substantially above year-ago levels.
Crude availability may remain adequate, but tight distillate inventories leave less cushion if agricultural and freight demand strengthen through harvest.
