A while back, Kirk sent me a link to some article that I cannot find anymore.  It was about the energy industry and how the market works and it had nice, colorful graphs.  I admit now that I mostly skimmed through the thing, mentally noting what my brain found interesting.

Then, just yesterday, something in my brain clicked from one of those colorful graphs.  I emailed Kirk:

I recall seeing somewhere that the US had actually been a distillate EXPORTER a few years ago.  Do you recall where I saw that?

I got a response:

No, but that would have been before 2000.  We had some spare refinery capacity back then.  Nothing like those value added processes.

Oh, how I wish I could have let it go with that answer.

Instead, I started looking into it.  When I think of distillates, my thoughts go to fuel oil and diesel fuel.  You know, the stuff that heats homes and brings tons of worthless stuff (that we continue to buy!) to Mal-Wart, as well as the food that seems to be going up in price every day.  Gasoline is treated as a different product.

...and then I found this:

US distillate exports hit a fresh record high in April, as strong global demand continued to pull diesel cargoes out of the US, according to monthly data released Monday by the Energy Information Administration.

The latest monthly figure of 472,000 b/d shattered the previous record of 402,000 b/d from February of this year, as well as April 2007 figure of 167,000 b/d. Year-to-date, exports have averaged 392,000 b/d; if cargoes move out of the US at this pace for the rest of the year, exports would far outpace the previous yearly record of 274,000 b/d set in 1993, according to EIA data.

Diesel cargoes going out of the U.S. seems odd, doesn't it?  Currently in this area, diesel is going for $4.759/gallon.  There are stories out there that prove just how dependent all of us are on this stuff and the price keeps going up.

And they're shipping it out of the U.S. - at record levels.  How is that possible?

Then I found the answer a little lower in the story:

This jump in exports supported prices in the US, even as demand tumbled.

Funny thing about the law of supply and demand when you think about the energy market and the United States: Demand is basically fixed.

We want it all.

So how do prices go up?  Manipulating supply.

In many of our conversations regarding oil and energy, Kirk has asked the basic question: How much do they charge for a gallon of gas?

My answer has been fairly consistent: As much as they want to charge for a gallon of gas.

Though outraged, I'm feeling better about that answer more and more each day.