|
|
Author
|
Topic: And You Thought Gasoline Was Expensive!
|
|
|
|
|
David Stambaugh
Film God
Posts: 4021
From: Eugene, Oregon
Registered: Jan 2002
|
posted 03-13-2008 06:49 PM
US Gov. Energy Information Administration sez this about Diesel fuel pricing (although some of the data is apparently a couple years old).
What Are The Main Factors That Affect Diesel Fuel Prices? Besides excise taxes [6 cents higher per gallon of Diesel, compared to gasoline], the following are the main factors that affect diesel fuel prices:
Cost and supply of crude oil: Crude oil prices are determined by worldwide supply and demand, and over the past few years increasing demand has put intense pressure on available supplies. The Organization of Petroleum Exporting Countries (OPEC) has significant influence on prices by setting an upper production limit on its members who produce about 40 percent of the world’s crude oil, have essentially all of the spare production capacity, and possess about two-thirds of the world’s estimated crude oil reserves. Prices spike in response to disruptions in the international and domestic supply of crude oil, such as the oil embargo in 1973, the Iran/Iraq war in 1980, the current war in Iraq, and the 2005 hurricanes in the Gulf of Mexico.
[Figure 4. Diesel Fuel Prices Follow Crude Oil]
Tight refining capacity and international diesel fuel demand: U.S. refineries have been operating at above 90 percent capacity over the last 10 years. Most other countries rely even more heavily on distillates and diesel for transportation than does the United States, and refining capacity is tight worldwide. U.S. diesel fuel prices are more and more affected by competing international demand for refined distillates.
Product supply/demand imbalances: Prices of transportation fuels are generally more volatile than prices of other commodities because the U.S. transportation fleet is so heavily dependent on petroleum and few alternative fuels are available. If supply declines unexpectedly due to refinery problems or lagging imports, diesel inventories (stocks) may decline rapidly. When stocks are low and falling, some wholesalers and marketers may bid higher for the available product. If the transportation system cannot support the flow of surplus supplies from one region to another quickly, prices will remain comparatively high. These are normal price fluctuations experienced in all commodity markets.
Seasonality in the demand for diesel fuel and distillates: While U.S. diesel demand is fairly consistent and generally reflects the overall health of the economy, prices tend to gradually rise during the fall, decline in the late winter, rise through the early spring, and then drop a bit in the summer. Diesel fuel use by farmers and for transporting goods for stores to build inventories during the winter holiday season, as well as cold weather in the Northeast where most heating fuel oil is consumed, can apply upward pressure on diesel prices.
Transportation costs: Transportation costs generally increase with increasing distance between the retail location and distribution terminals and refineries. Areas farthest from the Gulf Coast (the source of nearly half of the diesel fuel produced in the United States) tend to have higher prices.
Regional operating costs and local competition: The cost of doing business by individual dealers can vary greatly depending on where the dealer is located. These costs include wages and salaries, benefits, equipment, lease/rent, insurance, overhead, and State and local fees. Even retail stations next to each other can have different traffic patterns, rents, and sources of supply that affect their prices. The number and location of local competitors can also affect prices.
| IP: Logged
|
|
Leo Enticknap
Film God
Posts: 7474
From: Loma Linda, CA
Registered: Jul 2000
|
posted 03-14-2008 05:56 AM
The price difference between petrol and diesel has been widening here, too. There used to be only a penny or two in it, but it's now around 5-6p. Some oil industry spokesman they wheeled into a TV studio claimed the reason to be that as smaller diesel engines have got more efficient (common rail technology, engine management computers etc.), the proportion of road fuel sold has gradually been shifting from petrol to diesel, but that oil companies have failed to shift refining capacity accordingly. So although the process of refining diesel is actually simpler and cheaper, refinery capacity is getting out of kilter with consumer demand, hence rising diesel prices.
I can kind of believe that - a decade ago only one person I knew had a diesel car. Now it seems to be most of my friends and relatives. When I changed my car last summer I decided to stick with petrol, because I don't do a high enough annual mileage to offset the increased maintenance costs of a diesel. Given the variables of fuel cost and maintenance (parts and labour) cost here, you really have to be doing over 15k miles a year for diesel to be worth it.
| IP: Logged
|
|
|
|
|
|
|
|
|
|
|
All times are Central (GMT -6:00)
|
|
Powered by Infopop Corporation
UBB.classicTM
6.3.1.2
The Film-Tech Forums are designed for various members related to the cinema industry to express their opinions, viewpoints and testimonials on various products, services and events based upon speculation, personal knowledge and factual information through use, therefore all views represented here allow no liability upon the publishers of this web site and the owners of said views assume no liability for any ill will resulting from these postings. The posts made here are for educational as well as entertainment purposes and as such anyone viewing this portion of the website must accept these views as statements of the author of that opinion
and agrees to release the authors from any and all liability.
|