I know this is not NG related but can someone please tell me why diesel fuel cost more than gasoline ? When gas was $0.32 /gal diesel was $0.12 to $0.15 / gal. For years it was about 1/2 the price of gasoline .I was told that it takes more oil to refine a gallon of gasoline than it does for diesel . Anyone in the know ? Jed
Jed, one of the main factors impacting diesel prices is supply and demand. Over the last decade European autos have transitioned to using more diesel than gasoline. This has created more demand for diesel and upward pressure on prices. This is even more so in the winter with the increase in heating oil consumption because heating oil (No 2 Fuel Oil) is essentially the same as diesel.
I bet it is supply and demand. And a little greed too. I live in East Texas and travel I-20 to Shreveport almost everyday. There are 10 times more diesel trucks "18 wheelers" on I-20 now than there were in the 80's. I have noticed that at no time at any point on I-20 will there not be a 18 wheeler ahead of you or behind you going or coming . There is always one in view. Lots of good trucking jobs out there ! I believe that one of the reasons that fuel got so high is to twist some arms into letting them open up more Alaska and Gulf drilling. They had to do something because they would not open it up by just nicely asking . I also belive that the reason that the oil shortage came about in the 70's is so we could start using others oil and save ours for the future. This world and country will not be here forever but may be here for thousands of years. They may have got together and said " Were sipping on our domestic reserves pretty hard and whats going to happen in 300 - 500 years when it runs out ? We then will have only one source and thats other countries oil and if we are still in a need position then like we are today they can name there own price per barrel. They would have us then for sure. I really believe that we have been saving ours for future generations and it makes since to me. I have intrest in 5 oil wells around Plain Dealing that was drilled in the 40's. They still produce what they always have since day one. No shortages with those wells. And there really shallow at a little over 1000 ft. Not many people know that The Beverly Hillbillies was filmed at Cottage Grove Louisiana about 7 miles NW of Benton. Jed
Hello Jed , I have heard that the demand from China for diesel has driven the costs up. China doesn't have the infrastructure that we have concerning power grids and things of this nature. Many of their factories are generator powered by diesel. With their expanding economy and their trade surplus , they are willing to pay premium price thus driving the market price even higher .It isn't about transportation for the Chinese as much as it is their means of production and survival in this global economy.
Oh geez.... spare me the BS please. If GREED by oil companies was the only thing determining prices, why wouldn't they increase prices EVERY DAY from now till the end of time? Why did oil drop from $145 to $113 per barrel in just over a month if the oil companies really do control the price? The fact is they that don't!
They can not control demand , only supply. They have helped to cripple the auto industry , their biggest supporter , by making those big ole SUV's look like the fuel hogs that they are. Now with people not buying those big profit SUV's, using more economical transportation and spending less time on the highways , demand is at a level that hasn't been attained in several years. Even tho there are more vehicles on the road then at that time. 40 billion Chinese on bikes due to the Olympics has had some affect. I believe it has shown us that we do have a small say in how much we are willing to put up with price wise from these guy's. If they had no control over pricing, how come its still not going up ?
Gasoline supposedly started out as a waste product because it is more volatile and cooks off. It doesn't really matter. There is a good reason which is based in energy equivalents.
A gallon of gasoline contains 124,000 btus
A gallon of diesel contains 139,000 btus
A barrel of crude contains 5,800,000
A barrel of residual oil costs 6,287, 000
The methods of calculating btus can vary, but these are representative of the relationship.
Remove the 19.5 gallons (which varies) of gasoline from the crude and what's left (which varies) contains other distillates depending on the source crude. From light sweet to Russian Sour to Venezuelan tar.
Sulphur has less to do with the costs of pollution than with the cost of engines that could run without it, i.e. sulphur acts as a lubricant in diesels. The most powerful diesels in the world, the 115,000-130,000 horsepower low-speed engines in container ships take heavy residual oil. Diesels can run on a multitude of fuels -- if they're set up for it or come from the factory that way. It won't help my MB or tractor diesel. If we added up all of the claimed costs for "extras" like sulphur, Gasoline would $97.50 and Diesel $113 a gallon.
Supply and demand does have a lot to do with it, but gasoline scarcity relates to diesel shortages.
Decisions made decades ago drive our fuel markets. While Europe reacted to the 1973 boycott with an emphasis on fuel efficiency and a determination to move away from Petro fuels. This was not goody two shoes at work. Europe, France in particular, saw their national security being held hostage because they had no fuel reserves. France is 80 percent nuclear on electric generation and most other European countries, from Sweden to Estonia are largely nuke electric. Russian NG policy has left an awareness that being plentiful isn't as important as being available.
While diesel powered cars are far more prevalent in European, They are much less important for commuters. Carbon taxes and congestion fees (whether called that or not) make cars much less desireable for commuters and why would you drive 500 miles for a trip that takes less than 3 hours by train powered by nukes. If you could afford it, you could commute daily from Nancy or Metz to Paris, 200 miles, on frequent, reliable trains that get you into the heart of the city in 1 hour and 15 minutes by schedule. Even the Spanish have honest high speed rail, most notably the Ave trains between Madrid and Barcelona which make more than 200 mph for all but the acceleration and slowing phase of the trip.
Diesel Fuel is just another way of saying home heating oil or off-road dyed fuel and while it's warm outside at the moment, the Northeast is trying to get oil to stay warm this winter. Consumption will vary with degree days. People who were paying $.99 a gallon or less in 2001 are now paying upwards of $5 a gallon. Price gouging? Sure.
But it's not just people heating their homes. Every airline in the world runs on some variant of JP4, roughly equivalent to a higher btu diesel fuel. A typical 747 carries 67,000 gallons or more. A 767 and others planes vary according to design range.
The White House contigent to China (2 747s, multiple c-17s, fighters, etc) probably went through 20 million gallons of a diesel equivalent, somewhat higher btu. Jumbos will go through 50-60,000 gallons on longer flights. Ships that once ran on coal now burn oil. Multi-fuel engines are more common now. The military for good reason have pushed for a single primary fuel, for diesel or turbos, tanks to helicopters. While it's a fraction of total use, we dedicate 28 gallons a day of fuel to each member of the military there. In WW2, it was just over 1.6 gallons a man.
European countries reacted with horror to the effect of the 1973 oil boycott, realizing that their national security was at risk. France had planned an extensive system of very high speed trains hauled by turbo locomotives. A prototype was built, tested and found okay. But the entire system was switched to electric locomotions in a system fed by nuclear generated power. France is 80 percent nuclear for power and export electricity to all of the surrounding countries, drawing complaints that it is too cheap.
I've considered a backup power system. Multi-fueled engines are much more desirable in the current situation. But if I could, I'd switch my home heating from oil to gas.
JBAM , Thanks for the information , you are very educated and an assett to this group. I could sit down and chat with you for many hours. I watched a special on tv about those huge container ship engines where each cylinder is as big as a small room and they just bolt on as many cylinders as needed. It showed a man walking around in a cylynder. I think it was a German made engine or maybe Japanese but Im thinking it was a European name. Low low rpm . I purchased one of the first 6.9 ltr Fords and it was ok with a 4 speed and 4.10 rear end but nothing up to my 2005 Excursion with the 6.0 turbo. I have to be careful on interstates because it wants to cruise at 85 mph. The 2008 is up'd to even more power with a double turbo charger system. The other two are making powerful diesels too. I still come out better with the diesel rather than the V-10 gas burner. The diesels mpg is much better. Would you believe that the 500+ horse 2008 Corvette Z06 gets 25mpg hwy and avoids the gas guzzler tax. Thats technology. I have one of the last 1996 Ford Bronco's ever made with a weak 351 and fully tuned up going 55mph hwy it gets 11mpg. It only has 30,000 miles on it and I just cant get rid of it. Its a guzzler. The interstate hwy system made us a totally different from Europe. It was one of the best ideas ever and really helped make this country what it is today and if we can still afford gas/diesel and if its available I cant see bullet trains here soon. Amtrack has had its problems. It may be the economy down here in the South but I cant see any economy problems around here. Gas prices didnt slow anyone down. Home sales are still booming , our building contractors cant build enough new subdivisions around here. They sell out fast. Restaurants are packed with people waiting in line. Im sure high gas really hurt the poor who only put $5 or $10 dollars at a time in there car but your average working family is doing good around here unless they have gotten into too much debt. You mentioned heating oil. I have always wondered why people still use it ? Is it due to the rock that lies just underground up north that has hampered construction ? What has kept people from switching over to NG ? I saw where a heating oil truck hooked up to the wrong house , the house was on NG but still had this pipe to fill up the heating oil tank. It was not pluged or capped off. The driver filled the basement with many gallons of oil. What a stinking mess to clean up ! Again I salute you for bringing us your thoughts and knowledge . You must have a chair at Cornell or MIT/CIT ! Jed
I am not sure what it is but back when prices went down for a while and diesel was higher than gas, when gas hit $3.00 per gal so did diesel, and as prices fell ,diesel droped faster than gas, but when it went back up again at the $3.00 mark diesel shot back above the price of gas and climbed faster than gas. There seems to be something about the $3.00 mark
As exciting as this is, we know that we have a responsibility to do this thing correctly. After all, we want the farm to remain a place where the family can gather for another 80 years and beyond. This site was born out of these desires. Before we started this site, googling "shale' brought up little information. Certainly nothing that was useful as we negotiated a lease. Read More