Why does deisel fuel have higher prices than gas prices if it is cheaper to make?

Question

Why does deisel fuel have higher prices than gas prices if it is cheaper to make?

Answer 1

The reason diesel prices are increasing is because diesel is #2 oil, which also happens to be home heating oil, which is in high demand right now. Combined with increasing crude prices, increased global demand and the weakening dollar, it's no surprise diesel is rising in price. Recent legislation has increased the cost of refining diesel to remove virtually all of the sulfur content.

Diesel is a separate fraction of crude than gasoline, a heavier fraction, so it can be made from cheaper crudes, rather than the more expensive WTI or North Sea Brent crudes which have the highest gasoline yields. The drawback, however, is that these crudes tend to be sour, which means higher sulfur content, increasing refining costs.

Additional cost comes from preparing winter blends of diesel for cold weather climates. If straight diesel drops below 20 degrees, it tends to turn into a gloppy mess in your tank. To avoid this, retailers mix in either a special compund designed to avoid gelling, or they add some kerosene, about 30%, to thin out the diesel. This added step increases the cost, which is of course, passed on the end consumer.

It really all boils down to supply and demand. There is a lot of demand for #2 oil right now and only so much refinery time available. Increased prices are a result of the general public wanting what they want and being willing to pay more. If folks turned down their heat and drove diesels less, supply would increase relative to demand and prices would soften.

Answer 2

Demand for it.

You can also see it with E85

Answer 3

Based on supply and demand.  That's it.

Answer 4

well many people have Diesel powered trucks so more has to be shipped out.  The shipping prices are higher because people want more of it.  Diesel is also better because if you get into a wreck, it doesn't explode.

Answer 5

demand