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Why does diesel fuel cost more per gallon than gasoline?

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  • 7 years ago
    Favorite Answer

    Diesel fuel costs, on average, about 30 cents more per gallon than regular unleaded gasoline, in the US. About 5 of those cents can be directly attributed to higher taxes: federal and state excise taxes are higher for diesel fuel than for gasoline. As far as the other 25 cents, basically supply and demand, and less competition at retail. Fewer than half of all filling stations carry diesel, so there's not as much price competition at the retail level. Plus, as "joseph" stated, in the US, the refining and distribution system is geared towards gasoline, not diesel, so it's a smaller market.

    The price premium for diesel is not the case in all markets. In some countries the combination of fuel cost and taxes results in diesel being less expensive. For example in Europe, diesel is generally the same or a few cents less per liter than gasoline.

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    Even so, you would still realize significant savings running a diesel engine as opposed to a gasoline engine. Diesels use about 30% less fuel per horsepower than gasoline, which more than covers the higher price of the fuel.

  • Anonymous
    7 years ago

    Diesel fuel had traditionally been less expensive than gasoline, since it was easier to refine from crude oil.Diesel fuel, also known as number 2 distillate, is essentially the same as home heating oil.

    The United States is a gasoline-dominant motor fuels market. Approximately 98% of passenger vehicles in the United States are powered by gasoline, with fewer than 2% powered by diesel fuel

  • John W
    Lv 7
    7 years ago

    Diesel prices doubled over night in the US when the ultra low sulfur diesel requirement was passed in the mid 90's. The diesel in North America is high in sulfur content which is why diesel personal vehicles were never popular the way they are in Europe. To meet the new requirements, the refineries synthesize diesel from a mixture of carbon monoxide and hydrogen gases called syngas. The synthesis process is the Fischer Tropsch process and the syngas is produced by steam reformation gasification of natural gas and coal though it can also be produced from wood, agricultural debris, old tires, trash, dried sewage or if energy from another source were available, directly from CO2 and H2O as Sandia Labs did with their CR-5 reactor. The high sulfur fuel is then diluted to meet the federal guidelines.

    The ultra low sulfur diesel requirement was from lobbying by the US automobile companies. In the 90's, German manufacturers developed a catalytic filter which removed sulfur giving them a distinct advantage in the US market due to EPA regulations. If you were around, you would've seen full page ads in the New York Times for the Mercedes Diesel sedan with a range of 1,000 miles on a tank of diesel. The Ultra Low Sulfur Diesel requirement neutralized the German advantage and doubled the diesel costs to the consumer thereby protecting US dominance in the US market. The US only wants a level playing field when it's tilted in their favor.

  • 7 years ago

    No particular reason, save a gallon generally gets you a heck of a lot further down the road in an efficient diesel engine. It contains a higher proportion of waxes and oils, which just means it cracks out lower in the tower.

  • Anonymous
    7 years ago

    because worldwide there is a high demand of diesel fuel and more is he demand more is the cost this is why diesel fuel cost more than gasoline.

  • Mike
    Lv 5
    7 years ago

    Plain and simple. Taxes. It does not cost more than gas in all states...

  • Kano
    Lv 7
    7 years ago

    Only because of the tax

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