Are gas and diesel prices equalizing?

[ToadHill]

Latest news around here is that speculators believe the world economy is improving and they have been driving up the price of crude oil.

 

[kmanvt]

Near Bristol, VA: gas 2.19, on road diesel 2.09, off road diesel 1.68. I bought 55gal of offroad yesterday.

 

[patrick_g]

The last few days diesel has been 9 cents under gas in the Norman, OK area.

Pat

 

[tallyho8]

I reckon I started driving (with a license) about 5 years before you did, and that same year my dad bought a service station. I don't remember the prices going up for the summer way back there (maybe they did and I just don't remember it), but it does seem to happen in recent years. And sure enough, right when I'm about to make a 2,400 to 2,500 mile trip.

My first job working for someone else was when I was 15 in 1960. I worked (under the table for 90 cents an hour) at a Tenneco gas station and was very alert of all the gas prices in the area. The normal prices between 1960 and 1970 never changed but a penny or two. Shell, Esso, Texaco, American(Amoco), Gulf and Conoco all had regular for 29.9 and premium for 33.9. Gulf had a low octane gas called Gulftane that sold for 27.9. Amoco had a premium unleaded white gas that sold for 34.9. Tenneco, Billups, Bay, Gulf Coast, Schwegmann and Spur were the discount stations that sold gas for 27.9 and 31.9. We had one family owned station, Franz-Ethyl that sold gas for 25.9 and 29.9 and sold "bulk" oil for 15 cents a quart.

I believe the bulk oil was oil that was drained out of cars during oil changes and then strained and sold in barrels to the stations that would pour it into 1 quart bottles similar to old milk bottles and sell it cheap. I knew many people with old oil burners that used nothing else.

In addition, Shell gave Top Value stamps, Texaco gave S&H Green Stamps and Tenneco gave S&H stamps plus free drinking glasses or other items with a fill-up. Naturally, everything was full service.

During this period, when summer rolled around, it was mainly the discount stations that would raise their prices 1 cent a gallon until Fall.

 

[Bird]

Yep, everything was full service back in the '50s. My dad bought a Texaco service station in Marietta, OK, in June '56, across the street from the courthouse. A bridge was out on the highway (U.S. 77) so all the traffic was routed through town and through Lake Murray State Park. We did a booming business until the highway re-opened so the traffic bypassed the town, and the drought that year hurt the farmers. Even the Chevrolet dealership next door went out of business. So we were lucky to sell that station to a retiree who looked over the books and only wanted a part time job for himself.

Then dad bought a Mobile station in Plano, TX, later added the auto parts store, and we took over the bus station for both Continental Trailways and Greyhound. We didn't sell the bulk oil, but we did have "two-bit" oil; i.e., re-refined oil for 25 cents when new oil was 40 and 45 cents a quart. Some folks seemed embarrassed to ask if we had any two-bit oil, but we were glad to sell it. We made 12.5 cents a quart on it whenwe only made 11 cents a quart on the higher priced oils. And we had "white" gas and kerosene for 10 cents a gallon. Of course, soda pop was a nickel a bottle so we collected $1.20 a case for pop that cost us $.80 a case.

 

[thatguy]

Yep, Brian, I've seen that in the news about the "summer blend" now, but there's lots of things I don't understand. How much more, per gallon, does it increase the production costs? It would seem to me that if it cost, for instance $.30 a gallon, that they'd just go up that much, but what they've done, here at least this month, is increase the price 9 to 10 cents a gallon a couple of times, then another 4 cents a gallon, then another 9 cents. So overall, yes, it's up 34 cents a gallon since 4/26/09 at the station I use the most. Is all of that due to the increased production costs for summer blend?

IIRC - I think it was something like $0.05/gal for 'summer bland'

Im would guess that the bigger jumps in prices would be based on the futures trading on wall street - Just like last summer it is what caused the drastic price increases (or at least that is what 60 Minutes said)..

Brian

 

[patrick_g]

So overall, yes, it's up 34 cents a gallon since 4/26/09 at the station I use the most. Is all of that due to the increased production costs for summer blend?

What am I missing? Can someone (who really knows and isn't guessing) straighten out my thinking?

1. Isn't the difference between summer and winter diesel that summer diesel is, well... diesel fuel and winter diesel has kerosene blended in to reduce the cloud point and reduce jelling due to lower temps and therefore prevent fuel filter clogging and the resulting fuel starvation.

2. Doesn't kerosene retail for way more than diesel?

3. Given 1 and 2 above why wouldn't summer diesel be cheaper?

Pat

 

[Duffster]

What am I missing? Can someone (who really knows and isn't guessing) straighten out my thinking?

1. Isn't the difference between summer and winter diesel that summer diesel is, well... diesel fuel and winter diesel has kerosene blended in to reduce the cloud point and reduce jelling due to lower temps and therefore prevent fuel filter clogging and the resulting fuel starvation.

2. Doesn't kerosene retail for way more than diesel?

3. Given 1 and 2 above why wouldn't summer diesel be cheaper?

Pat

I beleive Bird is talking about summer blend Gasoline

Winter blend diesel here is just treated #2, which does add a cost.

 

[patrick_g]

I beleive Bird is talking about summer blend Gasoline

Winter blend diesel here is just treated #2, which does add a cost.

SO... is it better late than never or better never than late?

Pat

 

[Duffster]

SO... is it better late than never or better never than late?

Pat

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