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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Peter V who wrote (169714)	12/8/2008 3:46:47 AM
From: Elroy Jetson	Read Replies (1) \| Respond to of 306849

I'm glad you understand the current trade-offs between gasoline and distillates/kerosene/jet fuel. As you can see, North American refineries maximize gasoline - yet still import gasoline from nations which maximize distillates. Other nations around the world, in spite of maximizing distillates, import distillates from North American refineries. If North American refineries maximized distillates, there would still be a shortage of diesel and a glut of gasoline if the North American auto market were shifted to diesel. Once you understand this supply demand balance, you begin to see that the use of gasoline instead of diesel for automobiles in North America has evolved over time and at this point is almost essential. Any significant shift toward diesel provides powerful incentives for new car buyers to purchase gasoline powered cars, due to falling prices for gasoline and rising prices for diesel. Refineries which use the gasoline fraction to produce synthetic diesel do not exist, but could be built. But the synthetic diesel would be REALLY expensive, just like the premium for Mobil-1 synthetic oil. I worked for Chevron long enough to understand this. Ask anyone involved in refining. .