Why are diesel fuel prices higher than gasoline prices?

On-highway diesel fuel prices have been higher than regular-grade gasoline prices, on a dollar-per-gallon basis, almost continuously since September 2004. This trend is a break from the previous historical pattern of diesel fuel prices usually being lower than gasoline prices except in cold winters when demand for heating oil pushed diesel fuel prices higher. There are three main reasons why diesel fuel prices have been higher than regular gasoline prices in recent years:

• Demand for diesel fuel and other distillate fuel oils has been relatively high, especially in Europe, China, India, and the United States.
• The transition to less polluting, lower-sulfur diesel fuels in the United States affected diesel fuel production and distribution costs.
• The federal excise tax for on-highway diesel fuel of 24.3 cents per gallon is 6 cents per gallon higher than the federal excise tax on gasoline.

Learn more:
Historical U.S. motor gasoline and diesel fuel price data
What do I pay for in a gallon of gasoline and diesel fuel?
What are the projections for U.S. gasoline and diesel fuel prices?
Energy Explained: Diesel Prices and Outlook
Average diesel retail price below gasoline price for first time in six years
Retail prices: diesel outpaces gasoline
This Week In Petroleum discusses petroleum markets. The May 20, 2009 and March 26, 2008 editions discuss this FAQ topic in more detail.

Last reviewed: February 6, 2024.

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