Why Diesel Prices Are High

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Total products supplied over the last four-week period averaged 21.3 million barrels per
day, up by 6.9% from the same period last year. Over the past four weeks, motor gasoline
product supplied averaged 9.2 million barrels per day, down by 2.6% from the same
period last year. Distillate fuel product supplied averaged 4.4 million barrels per day over
the past four weeks, up by 9.6% from the same period last year. Jet fuel product supplied
was up 2.4% compared with the same four-week period last year.

From the just released US report on oil refining and consumption for the week ending November 16, 2018. You can see why diesel is running higher in price than gasoline.
 
We export a lot of our more valuable crude in trade for other people's sour crude as strange as that sounds.

Never did understand the economics behind that practice, even if our refineries are optimized for the stuff
 
Interesting , thanks . :)

Any progress in gaining energy independence from Islamic producers and Venezuela is good news .
 
I seem to remember if the Keystone pipeline is finished , it will mainly supply heavy oil sands oil ? Wonder if that will get blended with lite crude & used domestically or exported ?
 
So, if homeowners are replacing oil heat with propane, what is causing the increased demand for distillate?

I would have thought the increasing demand was partially related to the NA maritime ECA, which requires reduced emissions from shipping, but that came into force in 2016. so IDK...
 
Originally Posted by WyrTwister
I seem to remember if the Keystone pipeline is finished , it will mainly supply heavy oil sands oil ? Wonder if that will get blended with lite crude & used domestically or exported ?


Yes, the Keystone XL pipeline will carry mostly heavy oilsands bitumen blended with condensate. This stuff can go straight into most refineries in the mid west and some along the Gulf. It doesn't require being cut with light oil. It can totally displace all of Saudi Arabian crude if you want. We just need to get that line built.

Meanwhile, the Exxon Baytown refinery is being expanded to take more light oil from Texas.

And always, some oil and some products will be exported. However, if the capacity to refine light oil was expanded, you wouldn't have to export so much of it.
 
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Heard a guy mention that having so many fuel blends has an impact on certain factions (in refining) that relates to diesel …
Perhaps Nyogtha could comment on this …
 
Class 8 truck market has been strong in 2017 and 2018. CNG/LNG are falling out of favor as an alternative fuel for line haul tractors, even though they never have been more than a small niche market.
 
Originally Posted by Rmay635703
We export a lot of our more valuable crude in trade for other people's sour crude as strange as that sounds.

Never did understand the economics behind that practice, even if our refineries are optimized for the stuff

A long stretch of high sweet-sour and light-heavy crude price differentials resulted in many US refineries configured to refine light sweet crude to shut down. Often the tank farms were retained for use as terminal instead of supporting a refinery. Subsequently those differentials collapsed as the market demand for light sweet fell and heavy sour increased. Now most light sweet crude refining capacity is outside the US where environmental regulations are considerably less stringent. The world's largest refinery is in India now.
 
If "the people" wanted cheap gas, they'd get over regulating refineries out of existence.

The lack of critical thinking from most of the populace is saddening.
 
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Originally Posted by SilverFusion2010
If "the people" wanted cheap gas, they'd get over regulating refineries out of existence.

The lack of critical thinking from most of the populace is saddening.


Depends on where it is at. I don't want it in my backyard, but I'd like to buy my cheap gas from your backyard refineries.

I'm serious, the Chevron refinery catches fire on a regular basis here, around every 3-5 years, and the residential zone nearby has to stay indoor for a couple days at a time when that happens.
 
This is part of how refining capacity is offshored to backyards of countries with far less stringent safety and environmental regulations along with low labor costs. Check the records of the PDVSA refineries in Venezuela along with the Dutch Caribbean refineries on Aruba and Curacao as examples in this hemisphere and refineries in India and the Middle East for refineries outside this hemisphere for reference.
 
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