ULSD (Cost)
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Post Fiend
Joined: Jun 2003
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ULSD (Cost)
May have been asked before, and I'm new to this but, do the further refining requirements of ULSD drive up the price and if so by how much? In the 80's I was paying 69 cents a gallon for diesel for my boat.
Elder User
Joined: Feb 2010
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From: Northern Il/Cabin in Wi
I would like to know this as well. Remember when diesel was always cheaper than gas. That was true for a long time. Then is wen up in the fall and they said it was because of farmers harvesting and furl oil. Then they blamed the wars.
The usld has to play a part.
The usld has to play a part.
Postmaster
Joined: Aug 2011
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From: Roll Tide, Roll
There are several good sites with very good info on your ? It is around 6.8 to 10.1 cents per gallon more to refine it to it's current ulsd. I believe it stated .02 cents was to put back in a lubriticty additive. But these prices are constantly changing.
Lead Driver
Joined: Nov 2005
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From: Kaysville Utah
My neighbor is a president of a large oil/gas pipeline.
He told me that it cost his company over $300 million to convert their refinery from LSD to ULSD. I have no idea how many barrels they refine a year or how long they expect it will take to recoup the $300 million.
If you remember back to when diesel prices last jumped to historic highs ( summer of 2006 if I remember right) The refineries not only incured the $300 million upgrade cost per refinery. But each refinery had to shut down around 2-3-4 months while they did the upgrades. The shutdowns reduced the amount of diesel that was available. Hence supply and demand came into play. With 25-35% less diesel being produced each month, demand out stripped supply and prices soared.
I don't know why diesel prices are staying high now. I suspect that demand has stayed high. Back when the SuperDuty pick up came out. Dealers were exicted to talk with me about buying a diesel because it helped their average, since most trucks back in the 90's were gas. I'll venture that today, Most pickups are diesel. When you add 300,000 Fords, 300,000 GM and 200,000+ Dodge pickups annually to the demand side of diesel, It's no wonder that diesel supply has not kept up.
He told me that it cost his company over $300 million to convert their refinery from LSD to ULSD. I have no idea how many barrels they refine a year or how long they expect it will take to recoup the $300 million.
If you remember back to when diesel prices last jumped to historic highs ( summer of 2006 if I remember right) The refineries not only incured the $300 million upgrade cost per refinery. But each refinery had to shut down around 2-3-4 months while they did the upgrades. The shutdowns reduced the amount of diesel that was available. Hence supply and demand came into play. With 25-35% less diesel being produced each month, demand out stripped supply and prices soared.
I don't know why diesel prices are staying high now. I suspect that demand has stayed high. Back when the SuperDuty pick up came out. Dealers were exicted to talk with me about buying a diesel because it helped their average, since most trucks back in the 90's were gas. I'll venture that today, Most pickups are diesel. When you add 300,000 Fords, 300,000 GM and 200,000+ Dodge pickups annually to the demand side of diesel, It's no wonder that diesel supply has not kept up.
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Joined: May 2011
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Want to know why diesel prices are so high when trucking, construction and home owner use of their cars has been down for three+ years and more people/industries than ever are switching from natural gas/diesel for heating. An article in today's USA Today (Front Page) confirmed my suspicions. The US in now exporting more oil products than ever before, led by diesel, jet and heating fuels (all essentially diesel fuel). The demand is not here, its overseas (especially in Europe) where they can't keep up with demand. So we are paying through the nose because domestic supplies are tight because the oil company's can get more money for it overseas. I'm an industry insider and am still pissed.
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Vijay
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Feb 25, 2011 11:27 AM
