Diesel prices now back below regular gas in Michigan
Since the second half of 2007, the price of diesel fuel in the United States climbed from its traditional place selling at or below the price of regular gas to a point 15-20 percent higher than premium through much of 2008. For automakers that were planning on introducing new 50-state legal diesel vehicles in 2008-9, as well as drivers looking forward to buying them, that was a big problem. The price differential ate up much of the operating cost savings that diesels provide thanks to their greater efficiency. Even as gas prices dropped from their highs of $4 per gallon last summer to less than $2, diesel remained stubbornly expensive. That situation has finally changed in recent weeks though. On a trip to northern Michigan a couple of weeks ago we started seeing stations actually selling diesel for less than regular gas for the first time in two years. That same scenario has now come to the Ann Arbor area, where I shot the sign to the right today on my way to get groceries. Nationwide, diesel is now averaging just under mid-grade gas at $2.023 while regular is at $1.910.
[Source: Energy Information Agency]
Reader Comments (Page 1 of 1)
ryan 8:40AM (3/23/2009)
Awesome news. I will be starting a 50 mile round trip commute every day in Michigan -- driving around in my Jetta TDI!!! 60mpg plus!!!!!
Really sucks that I will have to go back to driving a car to get to work though. Riding my bike to work every day for the past year has been an unbelievable experience.
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Rain 8:55AM (3/23/2009)
So the tariff on diesel imported into the UK finally has impacted the price of petro-diesel in North America.
Just when it looks like We are going to catch a break from the Petro-Cartel,they return to their old strategy of divide and conquer.
Abu dhabi buys 10% of Daimler:
http://bloomberg.com/apps/news?pid=20601087&sid=aWOXzwD5Rw8s&refer=home
I expect that to stay afloat the other manufacturers will follow suit in exchange for a seat at the table,in that event you can kiss what little progress was made,goodbye.
Looks like I am getting a bicycle despite the artificial knee after all.
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~D. 9:23AM (3/23/2009)
It's about time!
I bought a Mk.IV Golf TDI back in 2007 when diesel was cheap, only to watch it go up. To be honest, I never heard a reasonable argument for why that was either. It just seems like non-utility-grade diesels get unduly harassed in this country, like someone out there is purposely trying to inconvenience the passenger diesel crowd.
Anyways, believe it or not, I never really cried over the cost disadvantage (even though I figured it was being inflated) because I STILL got really good mileage and rarely had to gas my TDI up.
TDI w00t!!!!
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UH2L 9:54AM (3/23/2009)
I think diesel fuel prices were higher here in the U.S. when the economy was booming because it led to increased trucking to transport goods. Now that the economy has cooled, so has diesel fuel demand which is more dependent on commercial than personal driving.
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~D. 10:32AM (3/23/2009)
thank you, that is the first clear-sounding explanation I have ever heard on the subject.
The good news is, then, that if something like the Picken's Plan was put in action (having trucking transition to CNG or some other power source) it would allow diesel prices to stay low for torque-loving civilians.
Kumar 12:16PM (3/23/2009)
That's possible. The line always given, at least in the winter, was that demand was high for home heating oil. It seemed to make sense, considering the lack of refining capacity in the US, that refiners would intentionally create a situation where they could jack up prices yearly.
If diesel use were to rise dramatically in the US, the percentage of diesel destined for the Norheast would be smaller compared to the diesel getting the ULSD treatment.
Someone also mentioned a maximum ratio of diesel to gas from a barrel of oil, but I imagine that's higher than the tiny percentage of diesels in the US.
Killroy 12:00PM (3/23/2009)
Props to the one that said that he gets 60 MPG diesel. That’s is some major hypermiling even though diesel is %15 more carbon and energy dense, bla bla bla.
I’m in the philosophical boat that cheap diesel and gas is a bad thing. If the fuel is cheap, then there is not much of a incentive to go cleaner alternative fuels that are sourced in the US. Cheap fuel leads to people driveing more than they need and people buying more car than they need. We are buying more and more of our fuel from non-friendly countries and that is a major national security risk.
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Kumar 12:23PM (3/23/2009)
I also like the companion argument for more taxes on fuel. Not only does it provide more funds to repair roads, but doing so keeps a higher percentage of the cost of transportation stateside.
-M.Dub 1:23PM (3/23/2009)
Isn't it about time Subaru brought over their diesel???
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