Hard to believe I know, but oil rich California has been so badly managed, the lower supply of oil has resulted in expensive fuel prices at the pump. Who'd a thunk? The state is now reliant on non-US supply despite sitting on the resources to drive the whole state.
This is a lot like New Zealand. It now lacks a refinery and is wholly reliant on overseas fuel supplies, despite sitting on a mountain of crude.
Is this a conspiracy to collapse the economies of both territories, or just stupidity on the part of governments?
New Zealand shut down its only oil refinery in 2022. The way things are currently headed, NZ could end up with no fuel as it lacks the ability to refine its own oil.
World shipping, especially crude oil shipments along with the shipping of finished fuels, is about to be disrupted. That's the effect of tariffs, especially the 10% tariff applied by the US on Canadian oil imports.
Canada will now likely start exporting their surplus crude by ship to refineries worldwide. This diversion of oil away from pipelines will take up a percentage of the global tanker fleet. More crude oil being transported by ship, will result in more finished fuels being taken from those refineries by ship as well.
This should result in an increase in supply of fuel globally, and so reduce prices. However, there is only a limited number of tankers out there and if they're all working on something else, how many will be available to deliver petrol, diesel and aviation gas to NZ bearing in mind it is two weeks to NZ and then two weeks back running empty. Hmm?
That's right, NZ is at the end of the queue and may find itself unable to obtain spare capacity as all ships are working somewhere else.
