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Re: Questions on Diesel vs Gasoline Prices
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Posted by john in la on January 13, 2005 at 07:11:59 from (67.35.237.125):
In Reply to: Questions on Diesel vs Gasoline Prices posted by Alberta Mike on January 12, 2005 at 17:03:14:
What a Barrel of Crude Oil Makes (42 Gallons)
Product Gallons per Barrel
Gasoline 19.5
Distillate Fuel Oil
(includes both home heating oil & diesel) 9.2
Kerosene-type Jet Fuel 4.1
Residual Fuel Oil
(heavy oils used as fuels in industry, marine transport and electric power generation) 2.3
Liquefied Refinery Gases 1.9
Still Gas 1.9
Coke 1.8
Asphalt and Road Oil 1.3
Petrochemical Feedstock 1.2
Lubricants 0.5
Kerosene 0.2
Other 0.3 You would need to write a book to fully explain how the price of fuel is figured at the pump but it all boils down to supply and demand.
While the price of oil drives the price of fuel it only does it in the long run. Gas and Diesel are both sold on the stock market and the supply for that day really sets the price. While the consumer sees prices change every now and then the wholesale price changes every day. Sometimes twice a day. It may go up .05 today down .07 tomorrow and back up .03 the next day while the price at the pump stays the same. Some things you need to consider when comparing gas and diesel prices…..
Mark up on diesel is greater due to supply. There is not 3 diesel stores on every corner to supply the competition needed to keep prices down.
Oil refineries due there major shutdowns for repairs in the winter months for the most part when diesel is in a greater demand.
The cheep price of diesel caused the consumer to switch to diesel driving up demand which drove up the price. Some other things to consider.
Companies are in business to make money. They could care less if fuel cost $5.00 a gallon. In fact they would sell it at $5.00 per gallon today if they could get the guy across the street to raise his price to $5.01
While you and I buy fuel on a per cent basis the wholesale price is figured to the thousand of a cent. A thousand of a cent is big money to large companies because of the quantity they buy it in.
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