Diesel fuel prices.

[QuattroMan]

How much diesel fuel is produced relative to other petroleum products?
U.S. Refiner and Blender Net Production of Refined Petroleum Products in 2006 (Total = 6.56 Billion Barrels)


What is happening with diesel fuel prices?
For many years, diesel fuel prices tended to be lower than gasoline. Since September 2004, this trend has disappeared, with diesel fuel prices tracking or exceeding gasoline. In May 1998 the national average Diesel Fuel price was $1.069; and Gasoline was $1.038; in May 2008 gasoline was $3.72 and Diesel $4.33.
This price differential is due to a variety of factors – global and domestic, economic and political. Both gasoline and diesel fuel prices will increase as the price of crude oil rises, however other influences have worked to accelerate diesel’s price relative to gasoline. To understand the cause of this increase and its implications for the future, this paper provides a brief summary of the production process and the elements contributing to the current price spread between gasoline and diesel fuel.
Fuel production
Each barrel of oil is 42 gallons, approximately 19% of which is generally dedicated to the production of diesel fuel. This compares to approximately 47% for gasoline and 10% for kerosene-type jet fuel. The remaining 24% is split among a variety of oils & gases. While refiners have some ability to alter these percentages, they are unlikely to swing more than 7-8% in any direction. As a result, each barrel of crude oil will always produce more gasoline than diesel fuel.
Fuel Taxes
Motor fuel taxes are collected at the federal, state and sometimes the local level. The federal motor fuels tax goes toward the highway trust fund; a fund established to repair and maintain the nation’s highway infrastructure. State taxes are used for a variety of purposes.
Since October 1, 1997, the federal government has imposed a 24.4 cents per gallon tax on diesel fuel compared to a 18.4 cents per gallon tax on gasoline. Every state also levies a diesel tax the average of which is 22 cents per gallon (ranging from 8 cents in Alaska to 32.9 cents in Wisconsin). Some states levy the same tax rate on both gasoline and diesel fuel, however 15 taxes currently tax diesel more than gasoline with only 6 states imposing higher gasoline taxes. More information on state fuel taxes can be found here.
Why have diesel prices risen so significantly in the last few years?
Fuel Demand - Weakness in the U.S. economy has led to a softening in gasoline demand. While gasoline prices have increased this winter due to surging crude oil prices, they have not risen as high as they would have if year-on-year gasoline demand growth was unfolding at normal rates.
On the other hand, demand for distillates – such as diesel and jet fuel--- in Europe, Asia, and the Middle East has continued to grow at a fast pace. In Europe, financial incentives continue to promote the transition from gasoline-powered to diesel-powered cars and light trucks, while a growing economy has lifted transportation sector consumption overall.
Traditionally, seasonal changes in demand have also affected diesel fuel prices, however this year (2008) has seen an unusual pattern. According to the Energy Information Administration (EIA), gasoline usually sells at a premium to diesel fuel in the spring and summer, the peak driving season. In the autumn, demand for distillate fuels (heating oil and diesel) picks up due to farm use and trucking of goods ahead of the holidays at the same time that gasoline demand begins to soften. However this year instead of the traditional converging of prices in the spring, diesel fuel prices have continued to rise at a quicker pace than gasoline, leading to a 60-70 cent per gallon premium.
Inventories and supply balances
As Europe’s demand for diesel has grown through the dieselization of the passenger fleet and overall economic growth, Europe’s capacity to supply capacity has been strained due to refinery maintenance, tighter emissions standards, and unplanned outages. At the same time, a supply shortage also developed in the U.S due in part to U.S. exports of distillate fuel to Latin America and Europe to meet their high demand, leaving diesel fuel inventories at the bottom of a five year average.

[NicFromLA]

Here's to hoping diesel takes off in the US.

[Ferrer]

Originally Posted by NicFromLA

Here's to hoping diesel takes off in the US.

Diesel only makes sense if you do a lot of mileage.

In Europe many people bought diesels because they used less fuel, not realising that actually cost them money.

[roosterjuicer]

I remember a few years ago diesel was actually quite a bit cheaper than gas...now its almost a dollar more. I dont know of any diesels that get good enough gas mileage compared to their gas counterparts to make up for the increased cost of the fuel.

The only time i can think of (in the USA) where it makes sense to buy a diesel over a gas motor is if you buy a durmax/powerstroke/cummins and you do a lot of heavy towing. Otherwise stick with a gas motor.

[Dino Scuderia]

Diesel has always been cheaper than gas in the US until recently when world demand for it grew.

[MRR]

Originally Posted by roosterjuicer

I remember a few years ago diesel was actually quite a bit cheaper than gas...now its almost a dollar more. I dont know of any diesels that get good enough gas mileage compared to their gas counterparts to make up for the increased cost of the fuel.

The only time i can think of (in the USA) where it makes sense to buy a diesel over a gas motor is if you buy a durmax/powerstroke/cummins and you do a lot of heavy towing. Otherwise stick with a gas motor.

No The VW Jetta TDI more than makes up for it compared to the gasoline 2.0T. The Mercedes E320 CDI made up the difference until it was discontinued in 2006 for the bluetec E320 which actually gets worse economy than its predecessor for some reason.

[roosterjuicer]

Originally Posted by MRR

No The VW Jetta TDI more than makes up for it compared to the gasoline 2.0T. The Mercedes E320 CDI made up the difference until it was discontinued in 2006 for the bluetec E320 which actually gets worse economy than its predecessor for some reason.

I doubt it. I know the TDI jetta gets like 10mpg better than the gas jetta but thats not enough to make up for almost a dollar difference. In the mercedes i think the diesel gets even less of a mileage difference than the jetta.

[rallyswift75]

Diesel is $4.99 a gallon where I am.

[baddabang]

Originally Posted by rallyswift75

Diesel is $4.99 a gallon where I am.

Its like $5.20 here.

[QuattroMan]

the price is high yes,but dont you get more millage out-of it.?

[Zytek_Fan]

$4.89 here.
And $5.05 just across the bridge in Washington

[henk4]

Originally Posted by QuattroMan

How much diesel fuel is produced relative to other petroleum products?

that depends on where you live.
In the USA the refienry output has been traditionally veru much geared to producing the lighter ends such as gasoline, while in Europe the production of middle distillates got priority. (we always had more frugal cars so we needed less gasoline....)

[MRR]

Originally Posted by henk4

that depends on where you live.
In the USA the refienry output has been traditionally veru much geared to producing the lighter ends such as gasoline, while in Europe the production of middle distillates got priority. (we always had more frugal cars so we needed less gasoline....)

A lot of the oil that would be refined into middle distillates is "cracked" into shorter hydrocarbons (correct me if I am wrong) that make up gasoline.

[henk4]

Originally Posted by MRR

A lot of the oil that would be refined into middle distillates is "cracked" into shorter hydrocarbons (correct me if I am wrong) that make up gasoline.

indeed, the whole trick is to reduce the amount of residual fuel oil to the bare minimum. The secondary processing of the residual components (after the first round of atmospheric distillation) is done mostly with catalytic crackers in the USA, which produce more gasoline, while in Europe thermo crackers are more popular which produce more middles distillates. Traditionally demand for gasoline has always been proportionally higher in the USA than elsewhere, which is reflected in the technical lay-out of the refineries.

[roosterjuicer]

While we are on the topic of fuel production...what is the proliferation of propane out across the pond?

Propane is very popular here for home heating and especially grilling. whats it like out there?