Pay the Piper…or Hire Another Band

Just the other day, I was fueling my vehicle at a service station. While I was there, the station attendant emerged with a handful of numbers to change the posted fuel prices. He didn’t change the gasoline prices, only the #2 diesel. It went up 4 cents per gallon. At that station, #2 diesel was then selling for 6 cents a gallon more than 91-octane premium gasoline, and 22 cents a gallon more than 87-octane regular gasoline. I remember thinking, that’s nuts!

Of course, with diesels typically getting 20 to 40 percent better fuel economy than similar gasoline engine vehicles, a diesel still operates more economically, but where is all this headed? Why are diesel fuel prices outpacing gasoline? Shouldn’t it be the other way around? Shouldn’t the state governments be reducing fuel taxes on the more fuel-efficient diesels? And isn’t the current price of diesel fuel getting high enough to make alternate sources of diesel fuel, such as biodiesel ( http://www.bankspower.com/techarticles/show/18-The-Biodiesel-Alternative), and synthetic diesel ( http://www.bankspower.com/techarticles/show/19-Synthetic-Diesel-Fuel ) more feasible and attractive? And isn’t it time for legislators at all levels to get their heads out the sand and learn about the advantages and efficiencies of modern light-duty diesels? I think so.

Just a few short months ago, diesel fuel prices were typically between the price of 87-octane gasoline and 89-octane middle grade gas. Go back a little further and diesel was cheaper than regular gasoline. So while most people have been worrying about the increase in gasoline prices, diesel prices have been climbing even faster. I have read that this is due in part to an increased demand for diesel fuel in China. Do we export diesel fuel to China? I hope not. And if we are exporting diesel fuel, should we be? Or is it simply that the oil companies are refining fewer gallons of diesel from each barrel of crude? After all, with diesel fuel prices going up, truckers have no alternative but to pass along the increases as higher freight prices, and that drives up the price of virtually everything that moves by truck. Have you thought about that?

Maybe what I saw happening was that service station attendant raising the price of every loaf of bread and every gallon of milk in America. Now that’s scary.

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