[Blogger]

Isn't it a refined product? The left has fought the building of new refineries, so maybe the ones that exist are working so much on refining oil that diesel is less available than usual. Just a total guess.

[ShandaLear]

NOt another one...

[MrChips]

Simple: (1) China is hoarding oil (2) China is using a lot more oil, though not as much as it is hoarding (3) Speculators are driving up the price.

[smonk]

I've heard a couple of things. I've heard that the dozens of mega-projects in china are driving the cost of several commodities through the roof (concrete, lumber, steel), including crude.

I've also heard that the war is making the speculators crazy.

[Always Right]

You haven't noticed the price of crude oil? Desiel is made from crude oil.

[Doctor Raoul]

Ted Kennedy's SUV is a diesel, RFK Jr's SUV is a diesel, all 800 of ter-A-sah's SUV (which John doesn't own) are diesel, Daschele's Tahoe is a diesel.....it all comes down to demand exceeding supply due to hypocritical Democrats.

[DocRock]

Welcome to FreeRepublic. The price of Diesel is up because of the price of oil, the shortage of new refining capabilities and huge increases in demand.

What do you think about drilling in ANWR?

[The Loan Arranger]

Hope you find out, I drive a diesel car ('84 Mercedes-Benz 300D). Give my ex the finger for me the next time you're in Des Moines--LOL

[reg45]

Both diesel and gasoline are made from crude oil. Therefore an increase in the price of crude will affect the price of both gasoline and diesel fuel. Diesel fuel is a more abundant fraction of crude oil and is easier to refine, therefore it is slightly less expensive to produce. Some diesel fuel is actually "cracked" (broken apart) to create the smaller molecules that comprise gasoline.

[jbstrick]

Maybe this will help

[Doctor Raoul]

Hillary's "Vacines For Children" program was the thin edge of her neo-Communist wedge for "Nationalized Health Care". In typical Politburo fashion, "Chairman Hilary", as her "Little Red Book of Hillary's Sayings" clutching followers call her, took control of the vacine market, regulated almost all but the now all but state owned vacine business out of business and in true Communist fashion ruined everything for everybody.

Now that vacines aren't available, our senior citizens are forced to make a choice between vacines and diesel. Since they have no vacines due to Hillary, they are now injecting themselves with diesel, which drives up the price.

If we could just get Conrade, ops, I forgot, first among equals, I mean "Chairman Hillary" (note the black Moa suit) to take over the production, cost and distribution of diesel, maybe we could have vacines for the childrena nd senior citizens, better yet, free diesel for all because you have a right to diesel.

[ladyinred]

Perhaps you should check with any liberal buddies you might have and ask why we can't drill our own oil, thus reducing the price of all things oily. They seem to like the idea of our dependence on foreign oil, makes you wonder why doesn't it?

Welcome to FreeRepublic!

[TheErnFormerlyKnownAsBig]

I think I read it was something to do with hugh's series.

[Jet Jaguar]

Welcome to FR, Roper!

[LOC1]

Refining crude oil is a little like butchering a cow. You cut the cow into sirloin steak, round steak, rump roast, etc. What is left over is made into hamburger. So what is the cost of making the sirloin steak? You know the cost of the cow and the cost to cut it up. Beyond that, assigning cost to any one cut of meat is purely arbitrary. But you also know that the butcher has to sell the sirloin steak, the round steak and all of the other cuts for enough money to cover his cost of the cow and his labor for cutting it up.

Same thing for petroleum products. Diesel is no more a "by-product" of gasoline than a round steak is a by-product of a sirloin steak.

The refiner does not know any more about the cost of any one of his products than the butcher knows about the cost of each of his products. The refiner does know that he has to sell all of the products for more than the cost to buy the crude oil and the cost to process it in the now more expensive facilities required to meet the current environmental laws.

Basically the refiner does the same thing the butcher does. He charges what competition allows him to charge.

This time of year, diesel and heating oil become the prime products as we enter the winter heating season. Except for the sulfur specification, both diesel and heating oil are the same product. When demand increases for one of them, in this case heating oil, it increases the price for both of them.

On top of that general pattern, there is an additional factor affecting diesel prices this year. Beginning in January, 2005, diesel used for transportation on the highway must contain no more than 15 parts per million of sulfur. That is down from the current specification of 500 parts per million. To reach that new lower specification, which was instituted during the Clinton administration, requires new and expensive desulfruization equipment. Many refiners have installed that equipment, but others decided not to participate in that market because of the investment required to remain in it. The net result is reduced supply in the face of increased demand. That makes the price go up as the lengthy supply network requires that the ultra low sulfur diesel be entering the system now to be in place for January of next year.

If you want to find out more about diesel prices start at the following web page and then search the entire site:

http://tonto.eia.doe.gov/oog/info/wohdp/diesel.asp

On the other hand, if you are merely trying to disrupt Free Republic....nevermind.

[M Kehoe]

Welcome to FR. The "Post Reply" button is at the bottom left corner of each post.

5.56mm

[Cold Heat]

The product is not a by product of gas, but is gas before it gets further refined.

Our inadequate refiners have switched to home heating oil and there is likely a bit of a supply crunch as usual this time of year.

I have not checked diesel prices here, but they have held their price for quite a while while gas was going up.

I would prepare for higher fuel prices for the foreseeable future and hope it goes down. But, I do not think the international problems in places like Venezuela will allow for much lowering this winter.

If things cool off, it should be back to normal by mid year 05. If things cool off internationally. Right now, every country with storage is packing in as much as they can get and supplies are too tight.

[Sam Cree]

"this country and for what it stands for."

What does it stand for, to you?

[Redcloak]

It's simple supply and demand. Refiners shifted from other fuels to gasoline when prices first shot up. They were all hoping to make a killing. They promptly oversupplied the market with gas and the price fell. There's a relatively fixed amount of oil available for refining, so other prices went up as gasoline dominated production. The climbing price of oil didn't help either. As refiners see potential profit in other fuels, they'll shift production again, supply will increase relative to a fixed demand and prices for those products will drop.

[reg45]

Actually the high price / limited availability of diesel fuel / home heating oil is good. Let those northeastern Kerry-voting liberals freeze in the dark!