Why Does The Cost of Diesel Fuel Change?
The factors that determine diesel prices
As you are probably well aware, our economy fluctuates. Most items cost more than they did even just a few years ago. Some of the prices that you see in the grocery store may change from one week to the next. And the price of gas is constantly changing. This includes the price of diesel fuel.
What exactly accounts for the change in diesel prices? Let’s take a closer look to help better answer this question.
Changes In Diesel Costs Explained
There are a few different factors that affect the cost of diesel:
- Taxes: Each state dictates how much they charge in taxes on on-road diesel fuel. Therefore, the price of diesel can vary and change from state to state.
- Supply and demand: When something is in limited supply or is experiencing a decrease in supply, the price of this item usually increases. Diesel fuel is not made at the same high rate as gasoline. In fact, for every barrel of crude oil that’s refined, about half as much diesel is made as compared to gasoline. Therefore, the supply of diesel that’s available is not as large, which, ultimately, effects how much it costs.
- EPA Rules: The cost of diesel increased when the EPA (Environmental Protection Agency) started limiting the sulfur content of diesel fuel. The reason for doing this was to decrease toxic emissions, which can be harmful to humans and other living organisms. This rule pushed the U.S. to produce diesel fuel with a lower sulfur content in an effort to create less pollution. As a result, both the production and distribution costs of diesel fuel increased. Furthermore, diesel that contains a lower sulfur content doesn’t have as high of an energy density, which means that each gallon gives less fuel economy. This also contributed to an increase in prices.
Why Choose Diesel
Despite the fluctuation in its prices, using diesel to fuel commercial vehicles, generators or farm machinery still has its advantages. Here are a few reasons why commercial business owners choose diesel fuel:
- It’s becoming a clean burning fuel: Thanks to the EPA rules mentioned above, diesel is now cleaner and better for the environment than it has ever been.
- It is efficient: Diesel engines operate more efficiently than gasoline engines. With your typical diesel engine, about 40% of the fuel burned actually contributes to moving a vehicle while the remaining energy goes to engine and driveline inefficiencies or vehicle accessories. According to the U.S. Department of Energy, engines powered by gas only reach efficiencies between 12% and 30%.
- It reaches peak power at reasonable speeds: A diesel engine only needs to hit 65 miles an hour to reach peak power and they should usually run below 2,000 revolutions per minute (RPM) to maintain this peak power. Gasoline engines, on the other hand, need to hit a much higher RPM before reaching their peak.
Finding a Diesel Fuel Supplier
Finding a reliable and dependable diesel supplier is important, especially if your southeastern Massachusetts business depends on the fuel to operate effectively and efficiently.
That is where W.H. Riley & Son comes in. You can count on us for commercial diesel fuel, fair prices and exceptional service.
Contact us today to learn more about our diesel delivery services and to become a W.H. Riley & Son customer.