I’ve noticed this for as long as I’ve cared about gas prices but am only now getting around to asking, so I’m not specifically talking about any one period of time. Why are diesel prices seemingly so divorced from unleaded prices? I understand the concept of a price difference, but sometimes that price difference is $1 or $1.50, sometimes it’s 50 cents, and I’ve even seen the rare example where it’s cheaper than unleaded. Are the same forces acting on unleaded prices not acting on diesel? Why are they so independent of each other?
EDIT: I should specify that my experience is in the USA. It seems prices track much more closely in the EU/UK.
In: Economics
Looking at it from a North American perspective, sure and it’s been that way since about 2008. Prior to that it was fairly common for diesel to be lower in cost than gas due to EPA mandated changes in diesel fuel that increased production costs. From the EU perspective…diesel and gasoline are much more closely priced and tend to be much more stable (primary due to a much higher percentage of smaller diesel vehicles such as pickups, sedans, vans, etc).
The primary reason why they aren’t synced in the US though as to do with the demand for the fuel. Most people in the US own vehicles with gasoline engines but at one point or another everything you own (including your car) was brought to you by a diesel engine. So when gas prices go up because people are going on vacation or driving it doesn’t always line up with increases in shipping or increased demand for heating oil. But also keep in mind, diesel doesn’t always dictate the shipping costs as heavily as one might think because of the core beauty of diesel engines…they can burn a much wider range of fuels compared to gasoline engines. As an example, many shipping vessels switch fuels over to much cheaper bunker oil once in international waters. Most US military diesel engines are what is called multi-fuel engines and can even burn gasoline but typically get filled up with jet fuel.
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