Higher diesel prices predicted (IMO-2020)

[tx2sturgis]

Blame it on the UN. Or not.

But IMO 2020 is gonna hit the heavy shipping industry hard on January 1, 2020. The IMO (International Maritime Organization) is an agency of the UN, and they are essentially in charge of international shipping vessels.

IMO 2020 is a complex and detailed emissions act aimed at reducing the sulphur oxide emissions of heavy ocean-going cargo ships that ply our oceans by the tens of thousands, spewing out toxic emissions.

The newest regulations will be in effect January 1st, but as the world's refineries ramp up to supply the new blends that the vessels burn, diesel fuel prices are expected to rise...some estimates are as low as only a few percent, or maybe as high as 30% higher for a gallon of diesel at the pumps, at least for a while as the refineries adjust.

Most of these vessels burn a lower grade of fuel oil called 'bunker fuel', but to meet the new low-sulphur requirements, some of the higher grades of fuel oil from each barrel of crude will have to be siphoned off to make the new blends the ships will be using, possibly impacting retail gasoline and diesel prices at the pump.

The trucking industry is gonna be taking the brunt of higher diesel prices, but those of us with diesel pickups, vans, and motorhomes might also take a hit in higher prices at the pump.

I placed this article in the Money Matters and Budgeting subforum, because many of us are on a tight budget when it comes to fuel prices as we travel. This is not a thread designed to be political...but politics do play a role in our daily lives. 

Let's hope the price increases are minimal and short-lived. 

Sources:

http://www.imo.org/en/MediaCentre/HotTopics/Pages/Sulphur-2020.aspx

https://mansfield.energy/market-news/impact-of-imo-2020-on-fuel-prices/

https://www.breakthroughfuel.com/blog/sulfur-2020-diesel-prices/

https://blogs.platts.com/2018/12/17/imo-2020-oil-diesel-consumers/

 

[Wabbit]

Diesel is cheaper to produce than gasoline. Why it's more expensive than gasoline, I have no idea.

 

[tx2sturgis]

Supply and demand. 

A typical barrel of crude can yield about 20 gallons of gasoline and about half that number of gallons of diesel.

Lots of variables can affect those values, and blending changes the numbers even more.

 

[Wabbit]

I'm not buying into the supply and demand rhetoric. I'm not talking about you repeating it, I'm saying I don't believe whoever is saying that in the first place. Oil prices have way less to do with supply and demand than they have to do with greed and politics. The USA is one of the top oil producers in the world. The facts don't match up to fit the supply and demand rhetoric.

 

[tx2sturgis]

One word:

OPEC. 

And corporate greed. Plus, oil is a global market.

But this would take us thru a political quagmire so...never mind.

Mainly I hope that we don't see a huge spike in fuel prices. But I wont be surprised if they do.

 

[Wabbit]

I'm not going to hold my breath while hoping prices won't spike, but I'm still gonna hope! Lol, that made more sense in my head...

 

[B and C]

When the prices go back up they will start fracking again. Just not profitable with the low prices.

 

[tx2sturgis]

Here is a video about IMO 2020....if you are really bored and have nothing to do...

 

[Wabbit]

Here's a link explaining what IMO 2020 is...

http://www.imo.org/en/MediaCentre/HotTopics/Pages/Sulphur-2020.aspx

It's been known for awhile this was coming(2008). There's already parts of the world where sulfur content is limited to .1 as opposed to the 2020 .5 limit.

I don't see this as a big issue. Shipping prices may go up initially, but they will come back down.

 

[Travelmonkey]

Diesel is cheaper to produce than gasoline. Why it's more expensive than gasoline, I have no idea.

In CA it is the taxes.  They added $.50/gallon tax in 2017 or 2018 so I pay close to $4/gallon .

 

[Wabbit]

/\ Ouch!

 

[eDJ_]

I understand that on July 1 this year Governor Mike Dewine of Ohio will be raising gasoline .10 cent on the gallon and Diesel
.20 on the gallon. 

Ohio July 1 2019 Gas/Diesel Tax Hike

 

[highdesertranger]

in California another gas tax goes into effect on July 1. I forget how much this one is all I know is fuel effing outrageous in California. it's at least a buck 50 a gallon cheaper in Arizona. highdesertranger

 

[Pleasant Travels]

I bought a Duramax Express 2500 Chevy van 3 months ago. Been enjoying the cheaper-than-gas prices during this brief inversion of prices. Once before, many years ago, diesel was cheaper than gas for about a year as well. Good times. I know they won't last. If I had the capacity to store a small tanker trailer, I'd stockpile it full of diesel right flippin now.

 

[Cammalu]

So, since I’m at the thinking stage of my next camper.... no diesel? I was going to get a diesel...

 

[Gr8ful]

Here's the gorverment EIA forcash which shows a slight increase in all energy but no huge sikes. https://www.eia.gov/outlooks/steo/report/prices.php

 

[eDJ_]

For those who are mechanically inclined (or have friends who get into this stuff with them)  I've been following these guys conversions using 4 cylinder Kubota Diesel Engines.  They are claiming up to 40 mpg.  I can imagine a Jeep Cherokee set up towing a trailer that has been converted to live in.   These engines available on ebay generally sell for $1000 to $1500
and are pulled from commercial trailer refer's.  (they won't meet emission limit laws for that application but seem to be acceptable in some localities for engine swaps). 

Especially if I lived west of the Mississippi River. 


Diesel Engine Swaps

 

[tx2sturgis]

So, since I’m at the thinking stage of my next camper.... no diesel?  I was going to get a diesel...

Sure, just fry a LOT of food and then make your own bio-diesel!

 

[Gr8ful]

I have an 40 something HP Izuzu reffer engine with very low hours complete with everything including fuel tank. The trailer was hit in the rear & totalled. I bought a quality 8k generator head but don't see myself finishing it. Too bad too it's a great set up. I like the 4BT Cummins for Jeep conversions.

 

[Gr8ful]

Here's an article from RV life on fuel prices http://rvlife.com/gas-diesel-keep-expecting-low-fuel-costs-season/