Faq

FAQ QUESTIONS & ANSWERS

RECENTLY ASKED QUESTIONS?

Why is diesel fuel more expensive than gasoline?

On a dollar per gallon basis, the price of on-highway diesel fuel has been greater than the price of regular-grade gasoline practically nonstop since September 2004. The historical pattern of diesel fuel prices typically being lower than gasoline prices, with the exception of extremely cold winters when demand for heating oil drove diesel fuel prices higher, is broken by this current trend. Diesel fuel costs have risen more recently than ordinary gasoline costs for three key reasons:

Particularly in Europe, China, India, and the United States, there has been a sizably strong demand for diesel fuel and other distillate fuel oils.
Costs associated with the manufacturing and distribution of diesel fuel were impacted by the switch to lower-polluting, lower-sulfur diesel fuels in the United States.
On-highway diesel fuel carries a federal excise tax of 24.3 cents per gallon, which is 6 cents per gallon greater than the excise tax on gasoline.

How much oil is needed to produce one barrel of gasoline and diesel fuel?

One 42-gallon barrel of crude oil is converted into approximately 19 to 20 gallons of motor gasoline and 11 to 12 gallons of ultra-low sulfur distillate fuel oil by American petroleum refineries (the majority of which is sold as diesel fuel and in some places as heating oil). From crude oil, a variety of additional petroleum products are processed. As refiners focus operations to fulfill demand for various products and as they strive to maximize profitability, refinery yields of certain products vary from month to month.

What distinguishes petroleum, petroleum products, and crude oil?

When brought to the surface from underground geologic formations, crude oil is still a liquid mixture of hydrocarbons. Petroleum products are created by processing crude oil and other liquids in petroleum refineries, extracting liquid hydrocarbons from natural gas in natural gas processing plants, and creating finished petroleum products in blending facilities. Crude oil and petroleum products are both included in the wide category of petroleum. Oil and petroleum are occasionally used synonymously.

What are petroleum products, and what are some applications for petroleum?

Transportation fuels, heating and electricity-generating fuel oils, asphalt and road oil, and the raw materials used to create the chemicals, polymers, and synthetic materials that are present in almost everything we use are all examples of petroleum products. Of the roughly 7.2 billion barrels of total U.S. petroleum use in 2021, completed motor gasoline accounted for 44% (including fuel ethanol), distillate fuel accounted for 20% (including heating oil and diesel fuel), and jet fuel accounted for 7%. The remaining 29% of global petroleum use in 2021 was made up of more than 25 different types of petroleum products, such as biodiesel, renewable diesel, and other biofuels. 17% of all the petroleum consumed in the United States was made up of nine different forms of hydrocarbon gas liquids.

Do we have access to enough oil to suit our demands in the future?

According to the International Energy Outlook 2021 (IEO2021) by the U.S. Energy Information Administration (EIA), the world's supply of crude oil, other liquid hydrocarbons, and biofuels should be sufficient to meet demand for liquid fuels through 2050. The availability and demand for liquid fuels in the future are highly speculative. By creating a Reference scenario, High and Low Economic Growth cases, and High and Low Oil Price cases in its predictions, the EIA accounts for some of this uncertainty. According to estimates, the current oil reserves in the earth's crust, along with anticipated production of other liquid fuels, will be enough to satisfy all scenarios under the IEO2021.

The reserves-to-production ratio, which is derived by dividing the volume of all proved reserves by the volume of current annual consumption, is a frequently used but inaccurate indicator of future resource availability. The measurement of proved reserves, an accounting concept based on well-known projects, is not suitable for assessing the long-term availability of all resources. Global reserves are projected to grow throughout time as new technologies boost output at operating fields and as new projects are created.

How is natural gas used and what is it?

A fossil fuel called natural gas is used to generate energy all over the world. It can be used as fuel for buses and other natural gas-powered vehicles. Another important feedstock for the petrochemical sector is natural gas.

How can natural gas be located?

To locate the best locations for natural gas drilling, geologists frequently utilize seismic surveys on land and in the ocean. Seismic surveys produce seismic waves in the earth and measure their amplitude to learn more about the geology of rock formations. An exploratory well is dug and tested if the findings of those studies show that a site has potential for generating natural gas. The test's findings reveal details about the kind and quantity of natural gas that is present in the resource.

What is the source of natural gas?

Deep beneath the Earth's surface, there are rock formations that contain natural gas. Natural gas and oil wells on land and at sea, as well as coal beds, are sources of its production. In more recent times, it has been produced via horizontal drilling and hydraulic fracturing methods, particularly in tight geologic formations including shale, sandstone, carbonate, and others.

How does the US currency affect the growing price of oil?

Oil is priced in US dollars on the international market. Therefore, when the dollar weakens, foreign currencies strengthen, allowing foreign countries to purchase more oil for the same amount of money. Demand increases when more individuals start purchasing from other nations, which raises the dollar price and, in turn, affects the price of oil on the international market.

How many different types of crude are there overall, how are they categorized?

According on the amount of sulfur present in the oil, there are roughly 161 different groups.

What part does the US dollar have in the price of crude oil?

Since the price of oil is expressed in US dollars, if the value of the dollar declines, the value of other currencies rises and the same countries are able to purchase more oil for the same price. which raises the dollar once again by increasing the demand.