gasitman

Why diesel is more expensive than gas? Correct me if I am wrong, but does it not cost more to produce gas than diesel? It is around $2.05 in Washington state. Gas is $1.85. I bought my truck to save money on fuel. But it is not looking like I am doing that.

infidel

I think what goes on is they are charging more for diesel so they can sell gasoline for cheaper and make the same profit. More people would get upset with higher gas prices than diesel.

Jambbii

That is an interesting point I have never thought of Infidel. I owned my truck for 1 month before diesel went sky high and is slowly returning to normal

chaikwa

Not to pick on you Jambbii, but I think your train of thought is representative of most of us, and it's EXACTLY what the oil companies want our reactions to be. You said prices are slowly returning to normal. What's 'normal' about $1.92 a gallon? It's BETTER than the $2.45 a gallon it got up to in my area, but there's nothing normal about it! Don't get me wrong, I have no solutions, but the petroleum marketing people have achieved their goal... for now!

chaikwa.

Shovelhead

Diesel fuel is a very close cousin to Home Heating oil.

The companies hold their reserves for heating in the cold months that drives the price of on-road fuel up.

doomgaze

What Shovelhead said.

It's all about supply and demand curves. Diesel is traded under the Heating Oil heading. When winter comes around, the demand for heating oil is much higher than in the warmer months so that drives the price of diesel up. The demand is greater than the supply so the price rises.

Did you notice that before all these winter storms came through diesel started to drop in price? I heard a number of people tell me it was as low as $1.78 in some areas. We were having a very mild winter at that point and heating oil stocks were huge. At that point there was more supply than demand causing prices to drop to a new equillibrium level.

When warmer weather returns you can expect a return to lower diesel prices.

Geico266

When you consider inflation fuel is cheaper today than 10years ago, or 20 years ago. It's a bargan. You know what bottled water costs per gallon? I know this post won't go over big!

dssimecek

Yep, that is about the lowest price I have seen for diesel fuel in NW Washington, Think it was $2.03 at a Safeway.
Years ago when I ran a propane power GMC van, and prices of propane went up along with the price of diesel fuel it was the government, or oil companies wanted to make the cost per mile of the 3 fuels about equal.
Just for what it is worth.

gasitman

Thanks for all the comments, and the heating oil makes sence. But I remember when I bought my truck, diesel was around $.20 cheaper than gas.

infidel

I don't think the heating oil reason is true, diesel prices were higher than gas long before winter. In my area they were higher all summer.
Does sound like a good oil company excuse though.

Rain Man

Its the reason that the oil companies are showing a 41% profit. Its the american way. Screw the little guy and take advantage of all that you can.

Geico266

You can always ride a horse!
Profit is not a four letter word in a capitalist society.

Shovelhead

Check this site to compare gasoline and diesel price fluctuations.

http://tonto.eia.doe.gov/oog/info/gdu/gasdiesel.asp

Looks like we're all getting hosed, just different amounts at different times.

bkrukow

I am having a hard time buying into the heating oil scam. I realize there are still a few houses around the country that have oil furnaces but not many. Most are being phased out for more efficiant forms of heat. I know around here it is almost entirely heat pumps and natural gas in town with some LP on the farms. I personaly can think of only one house for sure that has oil heat. My wife and I looked at it abought 5 years ago and decided not to buy it partaly because of the oil furnace. I realize that a lot of OLD comercial builings may still be runing fuel oil furnaces but still, that does not amount to near as much as 20+ years ago when all houses and comercial buildings where heated on it. To me the demand for heating oil has got to be at an alltime low. I seriously dought that there are any new construction buildings going up with oil furnaces and most older buildings are being converted to some other form of heat due to more eficeant methouds of heating being available. My wife fell in love with a huge old house and consiquently we bought it. I figured it up one day and it is around 2500-3000 square feet. We heat the house with electric basboard most of the winter. There is an old early heat pump as well but that only works till around the freezing point. So we only run it for around a month in the spring and fall. THe elecrtic works well but when it drops too far below 0 it gets a bit cool in the house. Next year I will have a corn stove sitting here heating most of the house. I think those things are the way of the future for most people that are not to snooty or lasey to put 2 minutes worth of efort into it every few days. Most little stoves hold around 1 bushel of corn and will burn for 1-3 days depending on where you set the thermostat thingy on the side of it. Thats cheap heat. I fugured at the high end it would cost me $200 a year to heat my house and the unit is only around $1500-$2000 depending on the model. THey also build units that heat the hole house and the hot water and go inplace of a furnace for around the same price as a furnace. I think we need to go around dore to dore and tell people with oil furnaces to replace them with newer more efficiant forms of heat. Although I seriously dought we would find amny residential structures left burning fuel oil. Its all a bunch of hooee that the oil companies are laying on us to justify hosing us over on our fuel. Personaly I cant wate till the day someone can figure out exactly what amount of heating oil is still used today in an acurate methoud without the oil companies smuging the numbers to keep us baliving what the tell us. Someday this excuse is no longer gona fly.

Scotty

If they know they need more heating oil in the winter, why not take that into account and produce more...like planning ahead. Probably because if the winter was mild, they would have to drop prices to move the product, but I don't buy that either. They know how much is needed after all these years.

The trucking industry is going to use more diesel in the winter and so will heating requirements. I feel its simply a bottom line scam by the producers. If theres a shortage, then does that mean it costs more to produce? If theres a shortage, then how come everyone gets what they need and all of the producers are open for business?

Supply and demand plays a much smaller role in this then the profits for the producers.

Thats my story and I am sticking to it.

Another thing that burns me up...Theres a refinery right near the city here. Canada has some of the worst fuel in the world yet a very large precentage of whats produced here goes south...quite often I have seen the Flying J tankers crossing the border when I am crossing.