O/T Gas and diesel

What's the deal with the big differnts in gas and diesel now. Here in South Central IL. gas is $2.14 and diesel is $3.69. If they want to help the econ. lower diesel so the products can be shipped cheaper to bring the cost down in the stores.

I wish i had a tractor to put $4 gas in last summer

From what I've heard it's a plain old supply-demand thing. Either real or manufactured. They claim there's more demand for diesel now. Someone else on the board should know more about it than me. Jim

Off road diesel is 3.19 and gas is 2.59 here.

Well Andy, they have a chart called a "crack spread" or the difference of what wholesale gas/diesel is selling for in relationship to the retail price.

I have no idea how they arrive at such number but only that it exists. It's just another way to screw the American public when the prices are failing faster than the big boys want it too.

T_Bone

Andy;
You could write a book on why gas and/or diesel prices do not relate to each other or the price of oil.
Each product is bought and sold separately so each has its own price.
First the price of oil on the open market sets a standard price because oil refiners will not sell at a loss. So if oil goes up gas and diesel must go up.
Then you have the margin between what a refiner pays for oil and what he sells the gas or diesel for. This is called the crack price or crack spread.
Then there is loading rack tank quotas that play into the price because a oil company need to move a set amount of product a month or it affects its quota allotment in tanks it may store in but do not own.
Then there is station markup that can change by not what they pay for the gas or diesel but rather on what the guy across the street is selling it for.

Diesel has always been a higher markup for stations because of less competition.
You can notice this if you have a corner with 2 truck stops and 2 gas stations. All 4 stations will have about the same price on gas because they are all in competition with each other. BUT the truck stops can be higher on their diesel price because their business is not from pickups like the gas station is but rather large trucks that can not fuel at the smaller stations even if they wanted to.

Right now with falling oil prices the crack spread on diesel has room to grow large but political pressure especially since it is a election year is driving the crack spread on gas lower.

I have read that once the diesel was made super low sulfur, it could be exported to other countries. That cut into our supply and made the price higher than gas.

As far as I can tell, the first big change, or disparity between gas and higher diesel began when Katrina hit New Orleans. Much of the nation's diesel fuel was diverted to there to run huge water pumps, and it was supposed to be temporary. At that time, red high sulfur fuel was temporarily allowed to be used on the road in that area also.

Also, the changeover to ultra-low sulfur was supposed to cost and extra 10 cents per gallon, and wound up being more. Diesel fuel has to be cooked to get the sulfur out of it, and after that expensive procedure, an additive has to be put in to make up for the lube lost due to the cooking process. More expense - and also the cooked fuel has less energy - sometimes 5% less.

Since high sulfur fuel has also been higher than gasoline, there are obviously other factors involved. I bought 500 gallons of red fuel yesterday for $2.69 per gallon. Two weeks ago it was $3.49.

I think some stations are still holding onto the diesel they had and don"t want to lower the price and take a loss on what they have in the tank. On the interstate diesel is 2.78 in KS. In Augusta at one station it was 3.59. The two stations are maybe 8 miles away.

But, what somebody else said, if the diesel price was lower, we could ship product for less and retail prices should come down.

Forgot to mention bio diesel here is 3.61 and ULS fuel is still 3.69 as today! So it can't just be ULS cost to make!!!

Forgot to mention bio diesel here is 3.61 and ULS fuel is still 3.69 as today! So it can't just be ULS cost to make!!!

"Crack spread"..... what feels like has been done to you when you buy the stuff.

Gas is $2.49 to $2.65 in SE Michigan and Diesel is $3.50-3.60. I would love for Gas to stay at $2.50 for years, but the greedy SOBs will profit off of us and raise the barrel price, due to OPEC.

Dont really know why its like that.Still a dollar higher for diesel here in central,Mo,last week it was the same on the Interstate.Have not been to the Interstate this week,but here its 3.29 for diesel and 2.29 for gas.Farm diesel is a little lower,dont remember how much.I bet if people quit buying it at the high priced places they would find a way to lower it.I bet its got something to do with keeping the price of everything high.I think its sort of a business way of saying they arent happy with the government more than anything.As always I might be wrong,have been many times.Sometimes the more beer you drink the better a crazy idea sounds.
Untitled URL Link

Somebody smart with computers please tell me how,if I didnt do it,there is that URL link on my answer?Some crackhead thinks he is funny doing stuff like this,or did I mess up somewhere myself?I barely know what a URL link is,much less how to put one in my answer.