When will diesel prices start to fall?

Lex Tdi

Veteran Member
Joined
Oct 4, 2016
Location
Lexington ky
TDI
2013 Passat
It's started the retailers just havent started to lower, we buy fuel direct for our fleet from a wholesaler... price is based on 2 week wholesale market avg.
Bill we got Friday avg $1.65 per gallon, cant find it anywhere in KY at the pump for under $2.49.
 

nicklockard

Torque Dorque
Joined
Aug 15, 2004
Location
Arizona
TDI
SOLD 2010 Touareg Tdi w/factory Tow PCKG
Yep, WTI went negative $31/bbl today briefly I saw.

How do I take delivery? I'll let you pay me $21k to take delivery of a rail car of WTI!
 

turbobrick240

Top Post Dawg
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Nov 18, 2014
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maine
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2011 vw golf tdi(gone to greener pastures), 2001 ford f250 powerstroke
I can picture it now, swimming pools full of free crude oil all over the nation! :D
 

Powder Hound

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Under a Bridge, Crestview, FL, USA
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Yep, WTI went negative $31/bbl today briefly I saw.

How do I take delivery? I'll let you pay me $21k to take delivery of a rail car of WTI!
Yeah, that's the real trick, isn't it? If you have an empty tank that can hold a contract's worth of crude you'd be having fun. Once in a while the futures market gets really strange.

Cheers,

PH
 

turbobrick240

Top Post Dawg
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Location
maine
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2011 vw golf tdi(gone to greener pastures), 2001 ford f250 powerstroke
Contagion contango. I wouldn't be the least bit surprised if diesel is $4+/gal in a year from now.
 

IndigoBlueWagon

TDIClub Enthusiast, Principal IDParts, Vendor , w/
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South of Boston
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Contagion contango. I wouldn't be the least bit surprised if diesel is $4+/gal in a year from now.
Although US production seems to be able to ramp up pretty quickly when prices rise, and of course they'll want to do that, I could see some volatility as worldwide production and demand fluctuates.

I like high fuel prices. Over and over it's proven to be the only thing that causes people to reduce consumption.
 

kjclow

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Charlotte, NC
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2010 JSW TDI silver and black. 2017 Ram Ecodiesel dark red with brown and beige interior.
That and a world wide pandemic!
 

Mongler98

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Mar 23, 2011
Location
COLORADO (SE of Denver)
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98 Jetta TDI AHU 1.9L (944 TDI swap in progress) I moved so now i got nothing but an AHU in a garage on a pallet.
So, unconfirmed sources tell me, fuel demand (trucking, jets, shipping, rail roads, and mass transit is down 70% from what it was, mass transit and shipping and railroads bump it from 50% to 70%. Is this true? I can see why! I was also told it costs a few million to shut down a plant and start it back up, not accounting labor loss and all the things around it. On an upside, road work is up because liquid assault price is down and is a prime time to do road work. This stuff could go on for another month or 2 at the very least. I see an economical exploit to be had here. Not sure how, but I dont think it involves pools full of oil!
 

turbobrick240

Top Post Dawg
Joined
Nov 18, 2014
Location
maine
TDI
2011 vw golf tdi(gone to greener pastures), 2001 ford f250 powerstroke
Although US production seems to be able to ramp up pretty quickly when prices rise, and of course they'll want to do that, I could see some volatility as worldwide production and demand fluctuates.
I like high fuel prices. Over and over it's proven to be the only thing that causes people to reduce consumption.
Yeah, I think a sharp increase in fuel prices is the most effective way to break the ridiculous trend toward huge, gas guzzling SUV's and trucks in the U.S. .

I'm not very familiar with oil field operations, but if there are a lot of bankruptcies and wells getting shut in, I think it might take a while to ramp back up to pre-pandemic production levels. But most likely months rather than years.
 

nicklockard

Torque Dorque
Joined
Aug 15, 2004
Location
Arizona
TDI
SOLD 2010 Touareg Tdi w/factory Tow PCKG
So, unconfirmed sources tell me, fuel demand (trucking, jets, shipping, rail roads, and mass transit is down 70% from what it was, mass transit and shipping and railroads bump it from 50% to 70%. Is this true? I can see why! I was also told it costs a few million to shut down a plant and start it back up, not accounting labor loss and all the things around it. On an upside, road work is up because liquid assault price is down and is a prime time to do road work. This stuff could go on for another month or 2 at the very least. I see an economical exploit to be had here. Not sure how, but I dont think it involves pools full of oil!
Any of your thoughts on what it could be?
 

Mongler98

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Joined
Mar 23, 2011
Location
COLORADO (SE of Denver)
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98 Jetta TDI AHU 1.9L (944 TDI swap in progress) I moved so now i got nothing but an AHU in a garage on a pallet.
Any of your thoughts on what it could be?
what? an exploit?
hoarding fuel?
no idea
buying stock when its low?
i'm not a risk taker like that.
and i was wrong, over 90% of air traffic is shut down and that is by far the largest consumer of fuel in the kero/diesel part of refinery.
aside from shipping cargo flights, there is basically an entire shutdown of the skys.
fuel was always affordable anyways, a few hundred bucks a month for serious commuters vs the equivalent of a pack a day of smokes.
I'm not saying that saving money is bad or stupid but i am saying that its probably one of our least of worries right now. you do know that more people will die from unemployment ,every 2% unemployment increase the US population death rate goes up 24%!
just my 2 cents.
im sure in a few years after the dust settles prices will be up again.
 
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turbobrick240

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Joined
Nov 18, 2014
Location
maine
TDI
2011 vw golf tdi(gone to greener pastures), 2001 ford f250 powerstroke
what? an exploit?
hoarding fuel?
no idea
buying stock when its low?
i'm not a risk taker like that.
and i was wrong, over 90% of air traffic is shut down and that is by far the largest consumer of fuel in the kero/diesel part of refinery.
aside from shipping cargo flights, there is basically an entire shutdown of the skys.
Not even close. We consume 2.5 times as much ULSD as jet fuel here in the U.S. And that's the ratio in normal times.
https://www.eia.gov/dnav/pet/pet_cons_prim_dcu_nus_m.htm

Buying stocks when prices are low is generally good investment strategy. Though I choose to avoid investing directly in the fossil fuel industry for a number of reasons. I'm not even feeling great about my investment in a S&P 500 ETF despite timing the market bottom nearly dead on. Too much fossil fuel in the mix. I'll probably trade that investment for something I can feel good about asap.
 

Tin Man

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Nov 18, 2001
Location
Coastal Empire
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Daughter's: 2004 NB TDI PD GLS DSG (gone to pasture)
When I drive to my locations I see a lot of 18 wheelers on the road. Essential commerce I'm sure. No EV 18 wheelers yet....
 

IndigoBlueWagon

TDIClub Enthusiast, Principal IDParts, Vendor , w/
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Aug 16, 2004
Location
South of Boston
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'97 Passat, '99.5 Golf, '02 Jetta Wagon, '15 GSW
When I drive to my locations I see a lot of 18 wheelers on the road. Essential commerce I'm sure. No EV 18 wheelers yet....
It'll be interesting to get some real data how drops in construction, fuel transport, auto transport, etc. affect overall diesel use in the US. It appears that the industry didn't anticipate the glut we have right now, surprisingly. If they had they could have stopped exploration and transport sooner and perhaps prevented at least some of the price crash. Given their lack of foresight until now, I tend to doubt any industry projections.
 

Mongler98

Top Post Dawg
Joined
Mar 23, 2011
Location
COLORADO (SE of Denver)
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98 Jetta TDI AHU 1.9L (944 TDI swap in progress) I moved so now i got nothing but an AHU in a garage on a pallet.
This is like extra credit. The people who dont need it will benefit.
Still have work (essential) then you can still afford fuel as regular price. Stuck at home with no job or as such, well too bad, guess getting supplies will cost a few cents less now.
One thing I do follow is commodities, only on the semi exterior though. Price of gold/fuel prices havealways been relatively equil in graph projections. UNTILL NOW.
So to me it will be interesting to see one price not follow the other.
As for s&p I'll buy more shared as things get worse (lower) swap for gold is still a tricky move as I foresee that gold will peak and soon as oil prices rise(do to economic growth when this is over) I project that gold will fall back down to 13ish. Who knows.
That's the move I would make. Also amazon stock is crazy atm.
As for fuel prices, i just filled all my containers so I'm good for 50 gallons of both gas and diesel. Love these truck stop pricing. One thing would be interesting to see is the price of auto parts and lubrication fall from lack of demand. When that happens (if it happens) it will be the mark of the low point. Another indication of the low point to watch for would be swap options and shorting positions on bank notes and mortgage packs. Just like in the housing market crash of 2006/8 there will be a down turn somewhere as demand shortens and supply increases. Construction businesses are booming right now to keep work flowing but no one is buying. The last bit is education, this could be the blow that leads to the bursting of the educational financial crisis we are building. So keep an eye out!
 

turbobrick240

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Joined
Nov 18, 2014
Location
maine
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2011 vw golf tdi(gone to greener pastures), 2001 ford f250 powerstroke
Get some sleep Mongler. None of that made any sense whatsoever. Well, except for the bit about filling up your cans with cheap fuel. That wasn't a terrible idea.
 

kjclow

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Joined
Apr 26, 2003
Location
Charlotte, NC
TDI
2010 JSW TDI silver and black. 2017 Ram Ecodiesel dark red with brown and beige interior.
NC is shutting down a lot of road construction projects due to lack of fuel taxes coming in.
 

nicklockard

Torque Dorque
Joined
Aug 15, 2004
Location
Arizona
TDI
SOLD 2010 Touareg Tdi w/factory Tow PCKG
Is there a tradeable futures contract based on price volatility of gasoline or diesel?
 

IndigoBlueWagon

TDIClub Enthusiast, Principal IDParts, Vendor , w/
Joined
Aug 16, 2004
Location
South of Boston
TDI
'97 Passat, '99.5 Golf, '02 Jetta Wagon, '15 GSW
There are ETFs based on future contract prices, but I haven't seen one based on volitility. I'd be shocked if there isn't some kind of a diverative product out there, however. As traders like to say, if it has a price and the price fluctuates, they can make money on it.
 

Hamman

Veteran Member
Joined
Oct 4, 1999
Location
Warren, OH
TDI
No TDI's, but an '84 Rabbit diesel
Diesel in my area hasn't dropped any more than 10 cents in the past month. Over the same time, RUG at some stations here has dropped to 96 cents. What gives?
 

turbobrick240

Top Post Dawg
Joined
Nov 18, 2014
Location
maine
TDI
2011 vw golf tdi(gone to greener pastures), 2001 ford f250 powerstroke
Is there a tradeable futures contract based on price volatility of gasoline or diesel?
If I wanted to make a quick buck in fossil fuels, I'd be looking at some of the tanker companies. They are making huge profits storing excess crude. Nordic American Tankers (NAT) is a prime example. But longer term I think there are much larger returns to be had in wind and solar.
 
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Lightflyer1

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Sep 13, 2005
Location
Round Rock, Texas
TDI
2015 Beetle tdi dsg
Or oil well owners with dry wells and some cash to invest. If it works for the Strategic Oil Reserve it should work for others as well. I don't know why this isn't done when times like this come around. Stock up when it is cheap!
 

jjblbi

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Joined
Sep 27, 2000
Location
lbi, nj
TDI
2014 Passat SEL TDI
We bought my wife's 2000 NB TDI in late 1999. Diesel was $.99/gal and $12-13 fill-ups were the norm.

My retired neighbor worked at Phila area oil refineries all his life. Every barrel of crude oil yields the spectrum of petroleum products from heaviest to lightest up the tower: asphalt, diesel, kerosene, gas, propane, butane, iso-butane are some. Diesel's relative higher price vs. gas is due to the further refinement needed to remove sulfur.
 

Tin Man

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Joined
Nov 18, 2001
Location
Coastal Empire
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Daughter's: 2004 NB TDI PD GLS DSG (gone to pasture)
When ULSD was required, the official word was that the extra refining would cost about $.03 to $.05 per gallon more. The world market, however, now could accept export ULSD so the price went up higher. Refining costs are important but do not price a commodity on the open market where supply and demand set prices.
 

jmodge

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Greenville, MI
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$1.10 for offroad
 
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