Why are Diesel Fuel Prices Higher?
The cost of clean diesel fuel is priced higher than gasoline because of several factors, including supply and demand; taxes; and low-sulfur regulations.
Compared to the United States, most growing economies use more diesel and less gasoline from each barrel of oil. The U.S. transportation fleet also relies heavily on diesel, thus limiting the consumer supply of clean diesel.
Taxes play a role in diesel pricing, as oil refiners must pay a federal excise tax for on-highway diesel fuels that is six cents per gallon higher than the tax on gasoline.
The EPA’s regulations on low-sulfur fuel may also impact the price of diesel because of the complexity of the refining process of sulfur extraction.