OT: The effect of diesel on the US economy

Diesel touches every aspect of American life. Although everyone puts a lot of emphasis on gas, I think that diesel has a larger economic impact. What do you think our lives would be like if we could get the price lowered? Would things be cheaper?

Marathon is expanding their refinery in Garyville La to the tune of 3.2 billion dollars.
Adding 180,000 barrels per day of refining capacity making 7.5 million gallons of gas and diesel a day.

• Marathon

Have you figured the VOLUME of switchgrass that would have to be stored to feed a single ethanol plant. Its more than 7 times the volume of grain.

Do you know that the enzymes to make that 7 times more ethanol from switchgrass do not exist today, that the available enzymes do only about half the ethanol as from corn?

By the time you get a field of switchgrass growing well, and a couple years of it harvested and stored there is a chance the process may work efficiently. Right now its pie in the sky, unrealized.

Gerald J.

When it was 25 cents a gallon, there were new cars for sale for under $1000 - and rural farms selling at $10,000 - $20,000. Many people were raising families on total incomes of $12,000 - $14,000 a year.

Cheap gas or diesel prices allowed our country to do business as usual - and not do anything to look ahead and adapt to some other fuel source. That's about it. Collectively, this country knew long ago that oil resources are finite, we can't control prices to resources we don't own, and we've sat back and done nothing.

And, stepping away from the collective mentality of our country or government being at fault - how many individuals do you see doing something on their own? A few - yes, but not too many. My mindset is - you can't gripe about government inaction if you haven't at least tried to do something yourself.

My main gripe about the new higher prices is - where the extra money is actually going. If it was going to good use - it would be a good thing for this country. But - from what I've seen, it's not - and much of the "alternative fuel" thing is absolute nonsense - especially ethanol and biofuel.

In regard to the ban on outside furnaces - is it for new intallations only or also the ones already in an being used? I ask, because all new installations will be Federally banned soon - and several companies already have the updated EPA compliant furnaces for sale that will be allowed. Central Boiler is one of them.

Diesel is now more expensive than gasoline in this region; maybe other Canadians can give feedback in their areas. I don't think it's like that south of the border.

First, the prices of all fuels, particularly petroleum-based fuels, are interlinked. Gasoline, diesel, kerosene, jet fuel all come from crude oil; refineries start with a barrel of crude and decide how much of each distillate to make. One way or another, it all gets back to the price of crude oil. Even the prices of non-petroleum-based fuels (coal and ethanol, for example) rise and fall with the price of crude oil. Likewise with natural gas.

There is a common belief that high fuel prices are bad. This is not necessarily so. Higher fuel prices encourage conservation, which is not a bad thing when you consider that there's only so much oil left. Not to mention the effect of fossil fuels on our environment. Higher fuel prices also increase oil exploration. Ask somebody who's working in the oil fields today if they'd like to go back to the cheap oil of the '80s and '90s. High fuel prices have created a lot of domestic jobs at time when our economy needs them badly.

You don't say how you propose to lower fuel prices. Would you have price controls? Any economist will tell you that, in the long run, price controls lead to shortages. Or would you eliminate taxes on fuel? If so, how would you propose to make up the lost revenue? Or would you subsidize the price of fuel? That's what we have today with ethanol production; it has resulted in, among other things, historically high grain prices which certainly has benefited farmers but has led to other unintended consequences. (For example, there is a shortage of hops, a key ingredient in BEER, due partly to the conversion of hops acreage to corn.)

In May of last year diesel was 40-50 cents a gallon cheaper then gas.I remember filling my diesel pickup at $2.69 when gas was $3.09 to 3.19.Right now diesel is 52 cents a gallon higher.Gas is $2.74 and diesel is $3.16.They are making a killing off diesel.

I can remember 40 years ago when diesel was 15 cents a gallon and gas was 30 cents a gallon.

Economy looked good in the nineties because things were out of whack; dollar was so high companies offshored millions of jobs with predictable results. Now we pay the price for that short-sighted bubble.

The man who invented the diesel motor ran it on peanut oil originally. And Henry Ford was an absolute bio-fuel nut. Right before prohibition it was reported that 90% of alcohol made in backyard stills was being burned in engines. Hemp can create Bio Diesel, methanol, ethanol, dynamite, concrete, cereal, clothes, construction materials, rope..... on and on 50,000 times over. Needs almost no pesticide, less fertilizer than corn or soy, and can grow on junk ground!

We have options, but the people who have the leverage to make scalable changes are just fine where they are at. Corn Ethanol=JOKE! How can we put a "crunch" on that?

Email me and I will send a copy of my report with an interesting (worth reading) link. It refers to information that any farmer would absolutely love.

AHHHH I guess that was my 2 cents.

Ryan

Hey Joe Zip -

I was in my mid 20's when I got my MBA. A lot of my coworkers ranging from 24 to 50 are working on their masters degrees.

I'd say the day you think you are too old to learn something new, you ought to just go check into the old folks home to wait for the end...

Howard

Larry