Economics: Differences Between Gasoline And Diesel Fuels

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Gasoline and Diesel fuels

Gasoline and diesel fuels are one of those products that majority of the working class requires in the daily basis to conduct their regular daily activities. From taking their kids to daycare, or dropping the kids to school or simply driving to work. The demand for gasoline and diesel fuels is all around us. The driving fuel for our public transportation, Gasoline and diesel fuels prices are constantly adjusting to the supply and demand equilibrium. There many factors that directly contribute to these changes and the most noticeable changes are at the pump. But what actually drives the changes in prices you may ask? As supply has increased, demand also has decreased. Even though the U.S. Energy Information Administration
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The Crude oil market are no exempt to the demand and supply factor. For example during 2008 and 2009 the weak economic conditions in the U.S. and around the world, led to a decrease on demand which brought prices down. With today’s worldwide economic recovery in the rising, demand is on the rise again but with the current uneasy situation in the Middle East and North Africa region has put the supply at risk. That combination of high demand and low supply had an inevitable result on higher prices at the …show more content…
With a decrease on demand and the temperature starting to cool, gasoline and diesel fuel retailers will begin to switch over selling the cheaper blends. Although cheaper in production the sudden change can transfer into a bump on prices. Other weather phenomenon such as the hurricane season may also have an impact in the fuel industry especially those that have operations in the Gulf Coast. Despite of the low cost fuel for the winter fuel blends, retailers continue to sell this cheaper blend so they can keep up with the competitive market prices. By fall, gas prices generally have decrease as much of the complications from this switchover are worked out. Despite what conspiracy theorists believe, price decreases in the fall have everything to do with a decrease in demand and nothing to do with pre-election politics (unknown,

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