If it takes less production to make Diesel Fuel than Gasoline, why is Diesel Fuel more expensive at the pump?

Question

If it takes less production to make Diesel Fuel than Gasoline, why is Diesel Fuel more expensive at the pump?

Answer 1

Don't think of diesel solely in terms of vehicular use.  #2 oil is also used for home heating oil and we're entering the high demand season for home heating oil.  The only difference between them is the dye injected during loading, and additives for vehicle use, if necessary.

You're not just competing with every other diesel driver, you're competing with every homeowner who uses oil to heat their house.  Oil heat is very common in the Northeast, but the demand affects the national price.

Answer 2

It's a quicker and less pure process, but in turn it uses more crude oil per gallon

Answer 3

thats why i dont have a diesel

Answer 4

if you could get away with charging more for your product to get a bigger profit wouldn't you? The only other thing I can think of is that there is a very big demand for it overseas with the war and everything that the prices are higher.

Answer 5

The CLAIM is that recent requirements for low sulpher etc have driven up the cost, but I doubt that's true.

Answer 6

First you have to understand the fractionating column, which is how oil is initially refined.

In the fractionating column, oil is heated at the base.  As the vapors rise, different products settle out of the gas into collection rings at different heights.  It's sort of like an overgrown whiskey still, except you're recovering more than one product from the distillate.

Thanks to a relatively new process called "molecular cracking," that means that a higher percentage of a lighter product, such as gasoline, can be recovered from a barrel of oil.  That decreases the amount of other products, diesel, Jet A, kerosene, etc. that can be recovered from a barrel of oil.  

While diesel engines are rising in popularity with owners of 3/4 ton and larger trucks, we haven't caught up with the popularity in the automotive and SUV segment that's rising in Europe.  This can be linked to several stigmas dating from the early 1980's when a diesel powered car didn't have the power to get out of its own way, (everyone remembers the lumbering old Mercedes wagons and Cadillacs,) the smoke, and the loud clattering of diesel engines that made them sound like they had rocks in them.

With oil reaching prices that are nothing short of rapacious, and the demand for diesel slowly growing as the demand for gasoline shrieks steadily higher and higher, supply and demand pushes the price up.  If you factor in the additional cost for refineries to produce ultra-low sulphur diesel fuel, (ever noticed that diesels don't smell as bad as they used to?) and the cost that the dealership has to mark it up to make any profit off selling it, the price goes even higher.  

Diesels compete with the markets for Jet A, Jet A-1, home heating oil and kerosene.  (Incidentally, diesels will run just fine on any of the aforementioned fuels, but you're up a creek without a paddle if you get caught doing it on the road due to the lack of road taxes.)

Greater demand for gasoline reduces production of diesel, and diesel competes with several other kerosene based fuels, causing the price of diesel to spike as winter sets in.

Hope I answered that for you.

JT