P.J

I was just thinking about one members Post on Diesel almost $3.00 a Gallon.
What's the deal here?
Back in about 1995 I worked for my In-Laws business, first time I drove and fueled a diesel truck. Now, I know things get more expensive over time, but lets get real here. If I remember correctly, Back then around here Regular gas was like $1.05 and Diesel was $.97.
Now then, taking into consideration inflation and the fact that we now have thousands of men on the ground in one of the most oil rich reigons of the world, how is this possible.
I know I'm probably trying to simplify this whole situation more than it can be, but lets get back to basics.
1) Is Diesel harder or more expensive to refine than 87 Octane?
2) Is there more Gas or Diesel yeilded from one drum of crude?
3) Now that the daytime averages in the North East are in the 50's and 60's, what excuse is being used to replace the "Heating Fuel Demand" B.S story?

I am not attmepting to spark a Political Debate here, just wondering if anyone can shed some LOGIC on Diesel prices.

P.J

Sorry to reply to my own post, but I just remembered when the switch happended locally. It was October of 2003, about a month after my CTD purchase. Diesel jumped form $1.60 something to 1.80 + and ran over gas.
Now, WHY?

Shovelhead

Because millions of American voters and their elected officials don't drive diesel-powered vehicles.

Notice when GASOLINE got over $2.00 a gallon how quickly the gasser drivers started complaining and the price magicly came down?

P.J

How many more millions of gallons have been flowing through OTR rigs, trains,tug boats and ships (I know, I'm forgetting some) since the beginning of internal combustion?
I would argue that the un called for increase in DIESEL prices are more dangerous to our economy than the gas problems. Everyone knows that 20-30 cents additional a gallon for gas isn't going to STOP any 50K dollar SUV owner form taking a road trip. (of which there are alot more of than us). Now, when we are paying MORE for EVERY SINGLE item at the grocery and hardware stores because of diesel prices, thats different.

Shovelhead

Until the $tarbuck$ starts placing a fuel surcharge on the price of a triple-moca latte, and Best Buy starts placing a surcharge on the delivery of a new 52 inch plasma screen TV, the gassers don't care how much the truckers have to pay for diesel.

abb

And the truckers don't raise a stink like they did back in the 80's cause now we get that old fuel charge put on most things that are trucked in and some of the drivers tell me that they are at times making a few more dollars with that then before so most are not even gonna raise a stink cause it's the same ole same ole

bmoeller

Crude costs more and therehave been no new refineries built in the US for 30+ years. The crude price is also a traded commodity in the stock market, aside from the supply/demand part of the equation.

infidel

Sure crude costs more but it still doesn't address why diesel costs more than gas when it never did before.
My feeling is diesel is subsidizing gas, charge more for diesel so you can charge less for gas. This way less people whine. Has nothing to do with supply and demand.

P.J

Ah, HA!, Now we are getting somewhere.

I should have made it more simple, how did one become worth more than the other?
In a "normal" market this makes NO sense.

I got one for you, lets just decide that Silver is now worth more than Gold? There should be more of one or the other available to make prices change so much over such a short time period, right?

swimmy

I'm not sure about this but I think there is a new mandate that diesel fuel be low sulfer. If that is the case we could be paying for a change in the refining process or it may be a reason to gouge.

Mala5

Checkout this website. http://www.chevron.com/prodserv/fue...l/L2_4_2_rf.htm

This illustrates the refining process. Diesel fuel is a by product of the refining process so in reality it should be cheaper than gasoline. Of course things have changed and sure there's more to the process now but it's nothing new. Hell before the diesel engine was invented, the refineries discarded it because there was no market for it. If you cruise through this website it talks about bio-diesel. Just thought you might want to know.

infidel

Your link didn't work, try this one
http://www.chevron.com/prodserv/fuels/bulletin/diesel/

P.J

Okay, the Chevron site makes for some nice light reading, if your a SCIENTIST.

So, form what I've gathered so far, we are simply going to continue to get ripped of here.
It's not only "not going to get better unitl it gets worse", (it's) "not going to get better, it's gonna get worse".

Can't wait till we get BioD here. I'm going to turn into some kind of Activist, telling everyone I know to use it.

xp8103

PJ,
One of the things you must as accept as fact is this: The PRICE of fuel (diesel, gas, No. 2, whichever) is NOT directly related to the COST of same. The COST of product has SOMETHING to do with it, but it is only a piece of the puzzle. Some of the PRICE includes delivery but it's less than many might think. I recently drove from Maine to Illinois and back. I paid anywhere from $2.51 to $2.09 for diesel along the corridor. The least was Ohio, the most NY. Now Ohio has refining capacity and thus smaller delivery costs. But diesel was MUCH cheaper in OH just over the boarder from PA where the prices were about the same as western NY. Now, PA has refining capacity. But Buffalo NY is closer to Cleveland than Toledo. But the price in Buffalo was MUCH higher than in Toledo or even Indiana for that matter. And the price in Maine is LESS than the price in NY but we are NO WHERE NEAR refining capacity. And don't bring Canada into it. Apparently Irving Oil (big Canadian Oil Company) and seem to refine and ship fuel across the border and sell it for the SAME price that US companies can, go figure. Prices are CHEAPER in NJ than they are in NY. But MA is cheaper than NY. So delivery isn't but a small part of it.
And in Maine, diesel is priced HIGHER than PREMIUM whereas most other states, it's about the price of mid-grade or so. It's not taxes. Maine (a/o 2003) had a 23 cent a gallon tax on a gallon of deisel while Ohio had a 24 cent a gallon.
So what is it? Refining costs? Tax? Delivery Charge? Or just one of the biggest instances of price gouging?

(evil laugh)

Childofthewind

The new ultra low sulfur isn't required until jun-sept 2006 time frame, in time to be available for the 2007 model year vehicles that will require it. There are some refineries making it now. CA may be different than most but I don't think this is generally avaible yet.