Fuel cost : Diesel Vs Petrol?

D

DJ 190

A2OC Donor
I replied to the recent thread entitled "Wow" and I think that my response might attract a wider audiance if I repeat it here .... I am interested in other A2OC members views as to why there is this such a difference in fuel cost, you see ..... Anyway, this was what I had to say :-
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Yes, an interesting thread ..... BUT, have you noticed that there is a hefty difference between diesel and petrol? I mean, diesel @ 139.9 p.p.l. and petrol @ 128.9 p.p.l.? Now only a few weeks ago, in Luxembourg, diesel was 1.18 Euro per litre and petrol 1.28 Euro per litre!!!! Diesel is consistantly cheaper all over Europe! Now I know that in Holland, the annual car tax is much higher for diesel cars (and L.P.G., for that matter ) but a lower diesel price helps to keep delivery costs down and therefore shop prices. The duty is the same in the U.K. for both fuels. Distallation costs are higher for diesel and the % yield from a barrel of oil is lower than for petrol ..... maybe refinery's are not geared-up for the increasing volume of diesel cars on the roads? I just don't think that a 11p difference is justified? What do you think? Oh, I have read that the differential is going to widen over the next few years!!! Oh well, there is 15% more energy in the same volume of diesel over petrol, and £30 per year road-fund helps, too, I suppose. Still affects the ultimate economy of these cars, though

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Tell me about it, just filled up with vpower diesel and the car tok 40.69 litres and it cost me £60!! most i have ever spent on fuel in my a2

Chris
 
In Slovenia difference is 1,23 versus 1,33 EUR only due to higher taxes on petrol.
 
None of the fuel prices are justified, you’ve got filthy Opec members having heart attacks every time the price of a barrel drops below $100, and irrational government taxation.

On top of that the near uniform pump prices that used to be on offer have gone, I no longer have to visit a service station on the M1 to find LAUGHABLE fuel prices as now you can find stations with 4 – 5 pence per litre discrepancies sat on the same road yards apart from each other. And you’re right, up until recently the price of Diesel was within 5 – 7p of it’s petrol counterpart, overnight that has shot up to a minimum of 10p where I’m based.

Steady getting fed up of force feeding the money whims of blue chip board members and shareholders via the relentless march of faceless price hikes everywhere.
 
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If you haven't come across it on the news, http://www.bbc.co.uk/news/business-15788207 . And the subsequent break down of the cost of petrol and diesel http://www.bbc.co.uk/news/business-15462923 . The graph shows less retail margin in diesel. The refining cost in the article disagree your assumption that refining cost is higher in diesel, but cost of the oil is higher and so the VAT scales with that. The break down article was when Brent Crude at $107. Currently, Brent Crude december futures is at $109.8x and Light Sweet Crude just under $101 so it should be a good indicator.
 
Humps "The graph shows less retail margin in diesel" so we are paying more too keep share holder dividends proped up? i mean it's not as if anybody accociated with oil can't pay their light bill. The media only feed us drubbing down jiblets to help keep the masses under rule. I mean what is "short supply" ?? it's all contrived and convenient, my local Shell has all the diesel you could ever buy as long as you're paying £1.44 a litre.
 
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I highlighted the retail margin because it appeals to me to indicates one of two things (as far as I can digest the limited info). 1, fuel retail business has less room to lower the prices of diesel than petrol. Or 2, there is more room for them to increase margins to match petrol, now that the trendy thing is driving diesel and so retailers can feel comfortable to increase the margin of diesel because people not able to switch to efficient petrol engines as if changing a set of winter tyres. My post is intended to explain some of the reasoning behind the diesel / petrol price gap, as in line with thread topic; I'm not trying to justify any profiteering, how OPEC cartel manipulate prices nor government fuel duty policies. Besides, I specifically said retail margin. The crude oil business is where they make the massive profits.

In an off-topic kind of sense, I'd say I'm indifferent to the current high prices. Yes, it is expensive but I drive an A2, it is not going to stop me at £130p/L. On the other hand, these high prices is pushing the automotive industry to accelerate development in more efficient power plants be it petrol, diesel, hybrids or hydrogen and I can only see that as a good thing. It moves human race forwards. And when one day the majority of transportation does not rely on fossil fuel, the balance of wealth will change, the political conflict will change and I certainly hope (or dream) it is for the better.
 
Damn, your kinda deep dude !! i don't share you optimism tho, the super conglomerates consume wealth as such a rate that I think they’ll actually “buy” any and all the profit making ability of future energy sources. Even If it’s salt water they’ll lay claim to that imo.

Agreed on the A2 front tho, but it's still bobbins to be paying £1.51 for a litre of V.Power and £1.44 for standard Shell.
 
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Diesel is still cheaper than Evian per litre. Explain that one and tell me where the real profiteering is!
 
You might say I'm deep, but it is really just how I tell A2 doubters I've bought and kept the right car. Besides, I do hope more people drive diesel engines and drive up the price gap! I have two cars, both of them petrol ;)
 
I suggested you were deep due to your comments on that BBC article as i'm just looking at the whole thing from an angry man perspective :eek: I've got a TDI A2 and i'm not happy about the price of diesel, i recall as a kid diesel was cheaper than Petrol not unlike LPG used to cost pennies not so long ago but since the rat goverment are taxing the hell out of it too in no time at all that will be over a quid a litre.
 
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Diesel usually costs more in winter than summer due to increased demand for heating oil which is very similar. There are also some genuine problems worldwide in meeting demand and not enough refining capacity. i am not making excuses simply trying to introduce some objectivity. I drive a diesel and I don't like it either but do wonder with the significant fall in sales volumes of fuel in the past 2 years (15%+) what the actual total tax take/receipt is from fuel compared with 3 years ago....... perhaps reducing the tax/fuel duty would actually bring in more tax from higher sales volumes plus have the benefit of reducing inflation and helping get the economy going..... :) Sorry, I know that's a stupid idea!?......
 
Adrian888 said:
Diesel usually costs more in winter than summer due to increased demand for heating oil which is very similar. ...
Click to expand...

It isn't exactly that. The crude oil has heavy hydrocarbon, it is the cracking technique that adjusts the output of lighter hydrocarbon products such as LPG, Petrol, Diesel, Kerosene...etc to suit the need of demand. As far as heating oil is concerned, it is almost a by-product of cracking crude into gasoline. The typical ratio is 3 barrels of crude, you get 2 gaso and 1 heating oil. Hence the popular commodity futures spread (a financial product) commonly known as crack spread or 3-2-1 spread. Demand is sure higher in winter but I don't think heating oil has much to affect diesel.

As far as UK gov rip off goes, lower sales has been somewhat offset by steady recovery in oil prices since low in 2009. I guess the hidden implication is rising cost of fuel makes people think about switching to more efficient cars. More spending, more vat, may even help to achieve emission target ...etc although this is probably wild off the mark.
 
You are deep thinking humps. All i see is me buying Vpower diesel for £1.19 a litre in summer 2010, and visiting the same Shell station today in 2011 with vpower listed at £1.50 I know some of that is a direct result of the monkeys in goverment printing fake cash and calling it "quantitative easing" & "re-capitalising banks" while ramping up inflation, but i'm completely in the dark with what ever it is you said although it sound 100% credible.
 
Another factor has been the deteriorating value of the £ against the $ which has added to the problem. I agree about QE though, and whilst its another topic entirely I can't help but think back to the start of this situation when Mervyn King said words to the effect that 'doing nothing is probably better'. All the half hearted attempts at applying useless finacial sticking plasters by innefectual hand wringing politicians (in other words almost any EU politician apart from the Irish who got their house in order PDQ) or printing money likes it going out of fashion (Obama being the worst) has simply made a bad situation worse..... Greece along with a few other countries and banks should have been allowed to go bust and by now we would be coming out of the problem instead of still staring down the barrel of a gun for another 7-10 years.
 
it is not really deep thinking, I happen to be in the line of business that comes across financial stuff, commodities trading ...etc while I'm not actually in any deals. On a technical note, Bank of England works independent of the Gov and it is theirs, not government, decisions on interest rates and QE policy. The gov runs the country's overall budget, tax and revenue so blame them for fuel duty. Regardless of how irresponsible bank lending was, I do however, believe if people spend within their means, don't invest (bet) in properties or things they can't afford if the market goes south then there would be much less mess. I was jealous of some people and wondered how my reasonable income can't afford the same. Well, now I just laugh seeing these people default on their debts and cars being sold back to dealers at silly low prices.

Any how, fuel prices is more driven by demand and supply, with a large dose of manipulation from the OPEC cartel. Our lust for cheap goods is the primary reason why developing countries are getting richer than ever, afford cars or just transportation for our ipods and cheap (almost) disposable clothes using more fuel than ever. Add to that, the increase in mining in Africa, Australia and South American countries also drive heavier demands for fuel. If you want cheap fuel, try getting everyone to pay for expensive locally made stuff that doesn't get thrown away every year (phones being prime example) would be a start.
 
AFAIK, uk refinaries were designed to make petrol so there is always a lack of diesel.
My last lot of Ultimate was £1.45 minus the discount
 
“I do however, believe if people spend within their means, don't invest (bet) in properties or things they can't afford if the market goes south then there would be much less mess”

Not wanting to go on as I know this is a car site and we’re not even on the ‘General’ forum, but I have real trouble sympathising with the government motto “We’re all in this together”. I have debts that I pay off and despite being taken on mostly pre 2008 when we “all had it good” I’m obliged to repay the excessive interest too. Ditto my parents and sister have mortgages the latter of which cost God knows what per month yet when she’s all paid up in around 20 years’ time she’ll have paid an extra £160k on top of the purchase price and that’s only if interest rates don’t skyrocket.

As such I find it hard to recognise mine or members of my immediate family’s part in creating this financial mess. Ok a few lurid banks collapsed when the subprime carnage hit the US but hey, if my kids shares linked CTF comes with a warning that we could losing everything then I’m sure the “sophisticated” financial vehicles that took those banks down did to.

Personally with regards to subprime, I don’t beleive a few people tossing away the keys to their homes is the catalysts for all this, at least not nearly as much as the goverments would like us to think, rather it was market gambling (beacuse that's what it is) that set the ball rolling. They took calculated high stakes risk with high rewards on the multiple subprime 'derivatives' that in this instance engorged the inital losses when it all went pear shaped, well that's the conclusion that i've come too with my very limited understanding of it all while reading between the lines of what the media are trying to brainwash me with.

Again sorry to go on:eek:
 
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chubbybrown said:
AFAIK, uk refinaries were designed to make petrol so there is always a lack of diesel.
My last lot of Ultimate was £1.45 minus the discount
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As far as I remeber diesel is a bi-product (waste) when producing petrol...
Though, I do not care about the pricing (except that they could be lower for both :)), since we have a diesel and a petrol. So we use the one that is appropriate, though I would like to have diesel A2, since I enjoy driving much more than with Octavia.
 
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