Diesel Prices Slowly Falling At Oklahoma Gas Stations
TULSA, Oklahoma - Oil is now less than $60 a barrel; and while that's great for buying it, it's tough on people selling it. In a lot of places, it costs more than $60 to pump a barrel of oil.
Experts say record production in the U.S. is driving the price down; and oil contractors in towns like Seminole are already getting fewer and fewer hours on the job, especially for smaller producers.
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"If you're small, if you got into the business late, if you have a lot of debt, if you're highly leveraged, some of those companies are probably either going to go out of business or have to sell assets to stay alive," said energy economist, Bernard Weinstein.
More than half of the city of Seminole's revenue comes from the oil industry. They've postponed several capital improvement projects because the money coming in is so uncertain right now.
On the flip side, drivers love the lower gas prices.
The average cost of a gallon of gas in Oklahoma is $2.09 cents right now; but, while diesel prices are also dropping, they're not falling nearly as fast as gasoline.
Truck driver, Steve Gichohi had fill up with diesel before leaving Tulsa for Dallas. He said the slow falling price of diesel doesn't have him feeling the same as many other drivers.
"All around the country you go around and you see cars and everybody happy, and showing up at the gas stations. But diesel, yeah, we still got trouble with that," said Gichohi.
Although you can find it cheaper in Tulsa, Oklahoma City and some other places, the average price of a gallon of diesel in Oklahoma is about $2.98 a gallon - down 54 cents a gallon from a month ago.
That continues a steady decline since 2012 when diesel was near $4.00 a gallon.
Wade Stites, who drives a diesel pickup, wonders why diesel isn't dropping as fast as gas.
"Barrel of crude, they get so much diesel and so much fuel; like I say, the ratio doesn't change, so why is the price different," Stites asked.
Industry experts said it's a supply and demand issue.
The part of a barrel of oil that produces diesel also produces heating oil, which is used more in the Northeast this time of year, keeping the price higher.
Plus, recent federal air pollution rules make producing cleaner burning fuel more expensive to produce, and federal taxes on diesel fuel are higher than those on gas.
"It puts a hurt on me some days,” said Tulsa driver, Richard Moore.
Gas has dropped in Oklahoma by nearly 20 percent in the past month. The drop in diesel lags behind at about 15 percent - enough to make a difference for many drivers.
"It would be nice if they drop it down like gas, it would help me out, because the higher it is, the less I make," Moore said.
The good news is the U.S. Energy Information Administration predicts diesel fuel will decrease through 2015.
"They say a lot, and sometimes they come through and sometimes they don't. So it's something we have to wait on, wait to see," Gichohi said.
Nationally, the average price for a gallon of gas has dropped 76 cents since this time last year. Diesel has dropped 53 cents a gallon.