Price of diesel, WTF yo?

[speeder]

How on earth can the price of diesel be significantly higher than gasoline?? I don't know about the rest of the country, (other than I know that prices are lower), but here in CA. the price of #2 diesel has spiked again in the last couple of weeks to well over $3.00 per gallon. As high as $3.50 at some stations.

I know that one of the manifold fringe benefits of the Iraq blunder is this wonderful *tax* on the population of the world and working people everywhere, but come on...., isn't their ******* beak full by now?

Eagerly awaiting some punk Republican oil company shill response, but everytime I fill my tank I want to kill someone. Talk about hyper-inflation; diesel was well under $1.00 @ gallon under Clinton. Arrrgh...

[Zero10]

It is kind of crazy, but right now we are in home heating oil season, which causes the diesel prices to spike a little bit.
I started paying attention after I bought my TDI. Last september diesel and gas were even where I lived (Calgary), and through the winter diesel would work up to be on par with premium (91 octane) gas, then in the spring/summer it would fall to ~10c/L below regular, now this winter I have moved to BC, so my comparison is not terribly accurate, but when I moved here in September, diesel was exactly on par with RUG, now it is 2-6c/L cheaper, despite the fact that we are actually in an area where people buy and use heating oil, and we are farther from the refineries.

Diesel price (much like the price of gas) has nothing at all to do with crude oil prices, and everything to do with how rich the government and the oil companies want to get on a given day.

[5axis]

I wish a punk republikan oil shill. Maybe then I could afford my bike racing habit.
Anyway I found this..

pages 3 and 4.
http://www.api.org/policy/tax/stateexcise/upload/october_2006_gasoline_and_diesel_summary_pages.pdf


I am so happy that we (illinois) have the highest fuel tax in the continental US.

Other than that, I dunno.
I keep hearing about fuel oil demand in the North East as a reason for high winter prices. We also pay extra for winter blends around here.

[fintstone]

Just greedy local governments looking to tax those passing through at a higher rate than residents....18-wheelers, buses, motor homes, etc. Also keeps those with high-mileage Diesel cars to pay about the same as those with gas guzzlers per mile driven.

[island911]

Denis, you really want it to be the fault of some Rebuplican don't you?

How 'bout this.... refineries are having to retool to produce low sulfer diesel fuel . . . and they are passing on the cost to you. (W'hoo!)

Now I know that must dissapoint, knowing your diesel dollars are going to help lower emissions. . . .acid rain and all. But hey, at least some of those taxes are going to be wasted by a Republican some where.

[Porsche-O-Phile]

Most military equipment is diesel. Supply and demand. If the military is gobbling the stuff up fast and furious in order to keep the killin' frenzy going over in Iraq, that would tend to push prices upward a little, no?

Not saying it's the primary reason, but I'm sure it's a contributor.

"Whatever the market will bear" is more likely the main cause. A fat cat only seeks to keep getting fatter.

[CurtEgerer]

The military is NOT contributing to current diesel prices!! How do you guys keep coming up with this theory (other than the predictable 'blame everything on Bush' .... ) There have been NO CHANGES in military equipment usage in the past 6 months. Even if there had been, the military accounts for less than 2% of the country's total fuel usage (with Iraq being a small % of the 2%). The prices has been coming DOWN, just not as quickly as gasoline. Diesel and gasoline are driven by different market forces (as mentioned in previous posts).

As for high prices in California, "it's the taxes, stupid!" :

>>>>>Diesel prices on the West Coast, especially in California, are relatively higher than other regions of the country, partly because of taxes, but mainly because of supply issues. The State of California assesses a combined State and local sales and use tax of 7.25 percent on top of the 24.4 cents per gallon Federal excise tax and an 18.0 cents per gallon State tax. Washington’s tax of 31 cents per gallon is one of the highest in the country. Besides taxes, West Coast retail prices are more variable than others because there are relatively few supply sources: 21 of the 36 refineries located in West Coast States are in California. California refineries need to be running at near full capacity just to meet in-state demand. If more than one refinery in the region experiences operating difficulties at the same time, the diesel supply may become very tight and prices may spike. The West Coast’s substantial distance from Gulf Coast and foreign refineries is such that any unusual increase in demand or reduction in supply results in a large price response in the market before relief supplies can be delivered. The farther away the necessary relief supplies are, the higher and longer the price spike will be.<<<<<

[notfarnow]

I remember when I bought my first diesel 5-6 yrs ago. I went to fill up and found that the price had SKYROCKETED to $0.61/ liter. Nowadays, I rarely see it below 0.90.

The upside is I can usually get 2 months out of a tank of diesel now. My record was this summer. I went 76 days on one tank of diesel, and that included a 2000km trip to Ottawa & back, and two 600km trips to Halifax... on top of my 18km daily commute.

[sammyg2]

Speed, you know nothing about this subject but contuinue to make wild claims and accusations and what is worse, you are too lazy to do even a little bit of research into the matter.

Start here, read, do your homework and take the tin foil hat off for a while.
http://www.eia.doe.gov/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/wpsr.html

[motion]

Its around $3.35 down here in my area. I'm convinced that the actual prices of gasoline & diesel have little to do with demand, futures, production, politics, etc. More than anything, I believe it is greed. I was up in LA/ North OC this past weekend and saw regular unleaded for as low as $2.29 a gallon. Down here in Laguna Niguel you can't touch it for less than $2.60. Some stations are asking $3.00. 30-70 cents a gallon more just because I'm 20 miles south (same county) and live in a more affluent area? Good thing my commute is zero miles a day. I refuse to even drive the truck. I'm not going to pay $3.35 for diesel.

[Purrybonker]

Originally posted by Wayne at Pelican Parts
I think in CA, diesel is not too common. I know when my Dad comes to visit, he has trouble finding stations in our area that stock it. Perhaps they know this, and keep prices relatively high knowing that they *can* charge the premium?

-Wayne

That's pretty much it. It's not hard to figure out how prices work with any commodity - it's all about volume and location. The more you move, the quicker the fixed costs are paid and end prices can drop. And if you're the only guy in town selling a commodity the price tends to move upward.

But diesel prices tend to average less than gas at retail/commercial, but really they shouldn't.

I think that diesel has a higher energy content by volume than gas so it should really be more expensive. But crude barrels get "cracked" to a certain degree based on demand for different products, so this BTU differential often gets lost in the translation. It's like a saw mill cutting up logs. They decide whether to make 2x4's or 2x6's based on estimated market - guess wrong and prices swing to compensate for supply/demand variation. They don't have complete flexibility with crude depending on a number of factors, but there is wiggle room.

[m21sniper]

Originally posted by Porsche-O-Phile
Most military equipment is diesel. Supply and demand. If the military is gobbling the stuff up fast and furious in order to keep the killin' frenzy going over in Iraq, that would tend to push prices upward a little, no?

Not saying it's the primary reason, but I'm sure it's a contributor.

"Whatever the market will bear" is more likely the main cause. A fat cat only seeks to keep getting fatter.

The really gas guzzling systems arent even deployed over there.

You want to talk about gas-guzzling, talk about a US Navy carrier task force.

Yeouch.

BTW, the military consumes mostly JP-4/5/8 by volume. Only ground vehicles run on diesel really, and some of those will run on anything(like the turbine powered M1 for instance).

[930addict]

My cousin lives in Texas and says that diesel is cheaper than gas down there. Both he and his wife sold their gassers and bought diesels.

Here's my conspiracy theory. There are European car makers that manufacture diesel powered cars that get 70-80 mpg. Until recently, their cars would not be able to operate in the US due to the US having such low grade crappy diesel (i.e. high sulfur content and particulates). The U.S. has delayed going to the cleaner burning diesel that Europe has been using for years now. If you notice, diesel prices started going up a couple years ago. This was about the same time a federal mandate came out requiring all diesel fuel to be the low sulfer type to reduce emissions. I read an article (I'll try to dig it up) that said that we're going to see more diesel offerings from European car makers here in the U.S. now that the fuel systems are compatible. I belive the higher oil prices are brought on by greed. We may have the option to buy diesel cars that get 70-80mpg, but it's going to cost us dearly to fill up the tank. They got us by the short and curlys.

[notfarnow]

Originally posted by 930addict
I read an article (I'll try to dig it up) that said that we're going to see more diesel offerings from European car makers here in the U.S. now that the fuel systems are compatible.

I've heard the same, although my understanding was more that we'll be seeing the japanese diesel offered to the European market.

The day I can get a 2-3 yr old Toyota Corrola or Honda Civic diesel will be the last day I own a VW.

[fingpilot]

OK, this begs the question from the Pelican BB Brain Trust.

I have a '94 Grumman Stepvan. On an Izusu NPR chassis. 3.9L turbocharged / intercooled diesel. Here in Southern mexifornia, I have been seeing 'low sulphur' diesel for $ale. Very much for $ale. An increase of more than .80cents per gallon over the previous blend.

Is this another 'boutique blend' that mexifornia is famous for? Will it do anything different in my van? I use the truck to haul motorcycles, so it's rarely loaded, and is typically driven at freeway speeds here in SoCal.

[island911]

No, that fuel won't really do anything extra for ya . . . other than piss-off speeder.

The low sulfer is for the next gen diesels with cat's. (like unleaded was, a long time ago.)



.... and some say it will cause injector pumps to die sooner.

[notfarnow]

Originally posted by island911

.... and some say it will cause injector pumps to die sooner.

I've heard that too... pumps begining to leak out their top hats, throttle shafts & nose seals. Most of the vehicles that start to leak are 10-20 years old though, so it's hard to say if it was the USLD like they claim, or just high miles.

[speeder]

My truck runs fine on ULSD, and FWIW it emits almost zero "diesel smell". I understand the whole reformulation thing, but it is virtually 100% changed over now so how would that make prices so high? They were lower when the ULSD was ~50% changed over.

I will have to take the experts' word for it that the military consumption is insignificant, but still the combination of added "terror tax" on a barrel of oil since we set the ME on fire and the waste of Iraq has to be a factor. As a bonus, we taxpayers are buying all of the over-priced fuel for the government, and their policies caused the crazy inflation. That and the oil companies having an perpetual end-zone fuch-dance under Uncle Dick.

[BlueSkyJaunte]

It's not just CA. Here in AZ (where you can find diesel everywhere) it's as much or more than "super" unleaded.

[74-911]

Originally posted by 930addict
My cousin lives in Texas and says that diesel is cheaper than gas down there. Both he and his wife sold their gassers and bought diesels.

Don't know where your cousin lives but around here (South TX) regular runs 2.09 -> 2.15 /gal. Diesel is 2.39 most everywhere and the .20 - .30 cent spread has been that way for quite a while.