Thread: Ouch.
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Old 03-11-2008, 12:44 AM
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JCL JCL is offline
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Quote:
Originally Posted by cmyX5go
It's a bunch of BS! Can someone please explain why diesel is higher than premium. It used to be that diesel was cheaper than regular. Doesn't it take less to process diesel?
Diesel should cost more, as it contains more energy per gallon, up to 15% to be precise. So, at a premium of $0.20 per gallon diesel is artificially low. Refiners are going to charge for the value you are getting, modified by whatever tax structure local governments have in place. In some locations diesel fuel taxes are lower due to the trucking lobby, but in some locations taxes are higher due to the greater number of automobile drivers than truck drivers (counting votes).

It takes less effort to refine diesel, but the cost reflects the fact that there is limited refining capacity, many refineries are focused on gasoline, low sulphur diesel required plant investment over the past few years, and distribution costs vary due to volumes. Also, diesel prices are impacted by heating oil prices (same fuel) whereas gasoline prices aren't.

All those expecting a free ride with their new diesel vehicles are in for a shock. It will level out, sooner instead of later. The cost of driving a mile will be the same once it does, IMO.
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Last edited by JCL; 03-11-2008 at 12:51 AM.
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