Diesel Fuel Prices

[happy campers]

$291.9 in this part of Wisconsin. I just can't wait until summer.

[keham]

What gets me is its 20 cents more a gallon here now then it was the last time it was 67 dollars a barrel. So until we drivers either start driving at least 10 percent less, drive at the best speed for fuel mileage. We all will get hosed. Used to be the truckers raised heck and help get it in check. But now they just add the direct cost up to the receiver and get the rebate back. (example outfit here fixs 1.89 gal as the price they figured and recoups the above that figure. Something about the Fed's passed act allowing them to do that late 05 or early last year. My brother just loves it.) Okay sorry for the rank. Just wish everyone would park one of the many cars they have and the ones for RV,s stay in a area a little longer and maybe just maybe the spike in supply would bring in back in line. And the Gov allow the drilling, and enforce the laws about price fixing. I am sure these few oil companies do. I meant exact price change around here at the exact time.

Sorry

[Native Tex]

What is so ridiculous about these prices is that even with the ULSD fuel, it still is much cheaper to refine than gasoline. It is the bottom of the barrel so to speak, but I think that it is being used to make profit for the retailers due to the recent diesel truck craze.

[Todger]

$2.69=2.79 in Myrtle Beach SC

[lwcdg]

I'm pretty sure the small retailers are NOT profitting by this increase. I know too many of them in my area personally. They're just like us, just making a living. The ones that seem to make the profit is the corp giants and the big middle men or handlers of tens of thousands of gallons.

I agree about the bottom of the barrel product being ungodly high but my biggest concern is that we are tearing our diesels up on this crap while being told it is ok to use. This may prove to be another lie thru ignorance.

I just talked with the mechanics about my fuel pump and they said since going to the new fuel their business has quadrupled! They believe this fuel is tearing up our pumps. Only time will tell. I hope they are wrong but I bet they're not. We're just going to have higher maintanene bills and the GM's, Ford's etc are going to say it's normal. Bull! Give me the old fuel anyday! I wonder how soon the ag and industrial machines will have to switch?
Chuck

[Montana Sky]

This all goes back to Economics 101 of supply and demand. The United States imports 63% of the world's daily oil production. As long as there is demand, prices will continue to stay up. When demand drops, so will prices. This has nothing to do with oil company CEO's or share holders trying to "scam" the consumer, it all comes down to one simple equation/formula: supply and demand.

Oil is cheap folks. Here is an example

A 20oz bottle of Aquafina water is selling for $1.29 a bottle. 1.29 / 20 = .065 cents per ounce you pay for water.
A gallon of diesel is selling (in my town for) $2.91 a gallon. 2.91 / 128 = .023 cents per ounce you pay for fuel.

It still amazes me that an oil company can build a billion+ dollar machine that drills 8 miles down into the ocean for oil. Then puts it on a boat and ships it to a refinery, refines it into fuel. Ships or trucks it again to a fuel depot where it is once again trucked to a fuel station for consumers. All this at a price of less than 3 cents an ounce. Meanwhile your bottling water companies are turning on a faucet and filtering thousands of gallons of water, then putting that water into a bottle where it is then shipped to a supplier. The supplier then trucks it to the retailer where it is stocked on the shelf and sold for almost 7 cents per ounce. It still amazes me how the oil companies can turn a profit.... I used this example a few years ago when this very topic was running on the MOC. It still applies today, I just had to use current retail pricing to get the per ounce data current.

[Montana Sky]

Chuck,
I 100% agree with you on the new ULSD fuel. That is the reason I started running a fuel conditioner. Anything that will help maintain my injectors and fuel system is worth it to me. Especially when replacing all 8 injectors will run a fella about $5,400 - $6,000 including, parts and labor to replace.

[bulldog402]

I only wish the fuel price was as low as Dave has it. Down here in southwest Florida diesel is anywhere from $2.79 to $2.90. Saw it in Orlando area this weekend for $2.95.

[msmoonsatx]

Montana Sky

I agree with you for the most part. I think that we have another factor entering into the equation. This is the investment community and the futures traders. When I look at the markets, they seem to fly at the least little rumor of tensions in the Middle East or the next hurricane season. When Katrina hit, the weather factor was supposed to have been priced into the fuel prices. However after recovery from the devastation, and during the mild season last year, prices did not come down. At the first predictions for 2007, the prices jumped up further. Investment advisors preach further doom and gloom and the markets react.

Unfortunately, I have no control over the markets. I can practice conservation and reduction of my own consumption, and budget for my planned future travels. I also shop for the lowest prices within reason. Hopefully, I can continue to enjoy my travels without resorting to oxen pulling my Montana LOL.

[Montana Sky]

Mark,

You are 100% correct. The market is going to react with hurricanes or trouble in the Middle East. The Middle East is one of the largest producers/exporters of oil in the world. And, as we all saw with hurricane Katrina, oil production can or will be effected by hurricanes. The reason Wall Street gets so jumpy is when oil production falls, and demand stays high, only one thing can happen. The price per gallon is going to increase. Naturally, in the perfect world as the price increases, demand should decrease. This in theory allows oil producers time to get production back up and running, but in the case like Katrina, demand did not slow down and reserve supply was being used. This caused a dramatic shift or increase in price per barrel which effects the price per gallon. In my opinion, Wall Street tends to be a little over zealous and causes panic in the market. They get all bent that folks are going to stop investing because of higher prices at the pump. While it can have some effect, I personally do not think that folks are going to stop investing because of higher fuel prices. If you cannot afford it now; one probably could not afford it a year or two ago. I believe you summed it up best with, "I have no control over the markets. I can practice conservation and reduction of my own consumption, and budget for my planned future travels. I also shop for the lowest prices within reason". Well said my friend, well said...

Ok, I will get off my soap box now...

[rvfirefighter]

The biggest problem I have with the prices of diesel fuel is the refinery process is less than gas.
Also the amount of profit the oil companies are making is an outrageous, greedy amount that proves it is not the cost of processing or refining that has raised the price, it is a simple fact that we cannot live life as it is without fuel for our vehicles.
I wish that I could do without fuel, but life as I enjoy it demands that I buy a certain amount at whatever price I must pay.
I feel that the government has let the consumer down, because we also export as much oil as we consume. All the oil out of Alaska goes to Japan.
Also stated by others the price is dictated by greed more than the price of oil.

[DonandBonnie]

Good lesson in economics here. As stated, every burp on the radar screen makes oil prices rise or fall, same as the stock market. The world ecomomy is based on this and nothing we say or do will change that. Just north of town here is a crude oil terminal. (Coal, clay and crude gave Mineral City it's name) This company buys the oil that eventually becomes Brad Pitt Motor Oil. They have to pay the local producers the same price for a barrel of oil that you hear on the news. When the price is up, the oil flows freely. When the price goes down too far, the oil stays in the ground. Higher prices increases our domestic production. Increased domestic production is good.

Unfortunately there isn't enough domestic production to make a difference. Why? Because we can't drill where there is a plentiful supply because some think that we may disturb a fish or caribou. We have enough oil in Alaska and the Gulf to make a difference. I am not advocating that we destroy the environment in the process. Industry and environment can coexist, contrary to what some politicians say. It doesn't matter right now how much oil is available. We don't have the capacity to refine it. Seems like every time a new refinery is proposed, who block drilling for oil, convince the politicians that a new refinery will destroy life on earth as we know it. All of this won't eliminate price fluctuations, but I bet it would go a long way to changing the price spikes to mere blips.

Another thing that I believe keeps the price of diesel high is called the fuel surcharge. When fuel prices rise, truckers (and other transportation companies) can add a surcharge onto their freight rates to be compensated for increased fuel prices. I may be wrong, but weren't diesel prices lower than gasoline before the surcharges and higher after? I don't begrudge a trucker from being fairly compensated for higher fuel costs, but when was the last time you heard the trucking industry complain about fuel prices. Seems like the price of diesel was much more important when the truckers threatened to park their rigs. Is the price of diesel kept artificially high because there is no more reason to complain? I really don't know.

I said earlier that I wasn't going to vent, but you guys started it and now I feel better. Hope I didn't offend anyone. I'm hearing that the price of petroleum fuels only has to rise about another half a buck for alternative fuels to be cheaper. Don't expect the changeover to be easy. I've already heard reports of a movement to stop hydrogen fuel because it will be harmful to the environment.

[simonsrf]

$3.09 Diesel in Mexican Hat, UT.