Future Price of Diesel

[schmism]

i am anticipating $4 pump gas and road diesel this summer... so in short ya going to be going up.

 

[RalphVa]

Wish it and gasoline would go to $5/gallon, to make idiots driving big monsters really sweat.

Ralph

 

[blueriver]

Wish it and gasoline would go to $5/gallon, to make idiots driving big monsters really sweat.

Ralph

And what do you consider a monster? I may be one of those "Idiots" your referring to ... when the cost of fuel goes up ... so goes up the needed products. Can we just shut down?

 

[deere755]

My fuel man told me to go ahead and get it now, this was back in January. I filled my tank with farm biodiesel b11 and it was $2969 then. I don't know if he had a crystal ball or not but he said he thought it would be higher come spring. I was getting pretty low so I told him to fill the tanks up. I don't use a lot in the winter but I was afraid I would run out before spring anyway.

 

[not2old]

Wish it and gasoline would go to $5/gallon, to make idiots driving big monsters really sweat.

Ralph

I guess I used to be one of those idiots, but when I tried to go to work on the bus they wouldn't let me bring my ladder. I was paying $5.00 per imperial gallon,subsidizing public transportation and paying more on my house taxes too. You think like a politician. How many of them have ever had a REAL job?

 

[Ford tractor]

Wish it and gasoline would go to $5/gallon, to make idiots driving big monsters really sweat.

Ralph

YEAH! Especially the guys driving 80,000 pound trucks full of food to be delivered to your local stores! And the guys driving 3,000,000 tones of coal down the tracks from the mines to the power plants that light your house!

Think about it next time you go to the store and milk is $5 a gallon and your light bill is $300 a month.

 

[rjmack]

Wish it and gasoline would go to $5/gallon, to make idiots driving big monsters really sweat.

diesel here is already more than that... has been for quite some time.

$5.27 for cdn gal, $4.22 for u.s. gal... and all from oil that comes from northern alberta.

if our resident economist is around, could you give me an understanding of why cdn produced diesel can be had for $3.00 per gal in the states, while we have to pay over $4.00 for the same thing here... after all we are closer to the source, why the higher price... especially since we supposedly have global markets that even things out? add to that, our dollar has been around, or above, par for quite some time.

just curious.

i have heard that the difference in tax rates doesn't even come close to explaining it, then again... who knows?

it's kind of frustrating to get so many different explanations, none of which seem to make sense on their own and regularly contradict each other.

we have global markets dictating high prices at times of low demand, and local markets dictating high prices at times of high demand (winter, holiday weekends etc) and then we have huge regional disparities that seem to be immune to either forces... (and usually dictate high prices) :confused2:

 

[smstonypoint]

$5.27 for cdn gal, $4.22 for u.s. gal... and all from oil that comes from northern alberta.

if our resident economist is around, could you give me an understanding of why cdn produced diesel can be had for $3.00 per gal in the states, while we have to pay over $4.00 for the same thing here... after all we are closer to the source, why the higher price... especially since we supposedly have global markets that even things out? add to that, our dollar has been around, or above, par for quite some time.

just curious.

i have heard that the difference in tax rates doesn't even come close to explaining it, then again... who knows?

it's kind of frustrating to get so many different explanations, none of which seem to make sense on their own and regularly contradict each other.

I'm an economist, so I will chime in. I haven't studied the situation, and thus I can only speculate about potential explanations for the price differences.

The recent average diesel prices were $3.51/US gallon in the US and $4.39/US gallon in Canada according to Diesel keeps climbing price ladder - Today's Trucking, the truck news site., so we are talking about a $0.88/US gallon average price difference.


You mentioned taxes and that would be the first item I would consider. Here's some info for the US.

The federal tax on diesel is 24.4 cents per gallon. The average state diesel fuel excise tax was 19.2 cents per gallon. Other state and local taxes average around 9.5 cents per gallon. These other taxes include applicable sales taxes, gross receipts taxes, oil inspection fees, county and local taxes, underground storage tank fees and other miscellaneous environmental fees. Adding these taxes and fees to the state excise taxes results in an average state and local tax of 28.6 cents per gallon.


Motor Fuel Taxes

Adding the federal and state taxes gives an average tax of $0.53/US gallon.

After a search (admittedly brief), I couldn't find comparable data for Canada. Could you fill us in on federal/provincial/other taxes in Canada?

The second item that I would consider is differences in refining costs/capacity. I don't know the data. Am I correct in thinking that most of the Canadian oil is exported in crude form?

The third item that I would consider is differences in distribution costs (i.e., crude to the refineries, refineries to terminals, terminals to distributors, etc.)

Steve
Edit -- I forgot to mention that I was assuming that the US and Canadian dollars were trading at par. Exchange rates would of course have to be taken into account.

 

[bigbull338]

go ahead an an wish for $5 fuel.because once that happens the economy will stall an die.an people will be getting rid of their big trucks for 25% of their value.

 

[nspec]

You want to know the real scoop, hear it is:

I used to work on a ship which delivered refined fuels to terminals in the Northeast, from a refinery in Delaware. This one particular terminal we went to was owned by a company called Motiva, which is a division of Saudi Aramco. They own stations under the name of Shell.

We pull in with the ship and unload a couple of hundred thousand barrels - say, 8.5 million gallons, into the tanks on shore. The trucks then load from the tanks at the terminal and deliver to the stations. There is a Shell station about 2 miles from the terminal - can't get closer than that. There is another shell station about 40 miles from the terminal. I know for a fact, that both stations get their gas from the same terminal. Would you believe that the station 40 miles away has gas $0.25/gallon cheaper!! How can that be with transportation costs? Shell dictates everything at the stations - they even tell the owners where to put the potato chips!

I'm telling you, the level of outrage by the American public needs to be ratcheted up about tenfold. Talk about the fleecing of America!!