Zero-Sulfur Diesel Fuel from Non-petroleum Sources: The Key to Reducing U.S. Crude Oil Imports
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2012-09-01
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Abstract:Zero-sulfur diesel fuel of the highest quality, the fuel used in this project, can be made by Fischer-Tropsch (FT) synthesis from many non-petroleum resources, including natural gas, which is increasingly abundant in the United States. Zero-sulfur FT diesel fuel can upgrade, and more-than-proportionally increase the supply of, conventional ultra-low-sulfur diesel (ULSD) fuel by targeted blending. Zero-sulfur FT diesel fuel could eventually even replace conventional ULSD, which has become the most valuable and profitable bulk-fuel product (supplanting gasoline’s former dominance) of petroleum refineries for about the past seven years; and production of zero-sulfur FT diesel fuel at the margin would not add incrementally more to the global-surpluses of gasoline and other products with low or negative profit potential which inevitably result from refining crude oil. Demand for ULSD is greater (especially when the US and world economies are growing satisfactorily) than the refining capacity available to produce ULSD from customary and readily available high-sulfur crude oils. This has caused, through market-driven increases in the prices of low-sulfur crude oils, and the follow-on increases in high-sulfur crude oil prices by the OPEC cartel (which would be illegal under US law), the prices of all petroleum-derived fuels to more than double (and to triple during price-spikes) since the middle of the last decade. Since the demand for ULSD, not the demand for gasoline, determines the amount of foreign crude oil imported into the US, any effort focused solely on “conserving” gasoline, will have no impact on reducing US imports of crude oil.
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