Highway Diesel Fuel Prices

RCED-94-276R: Published: Aug 24, 1994. Publicly Released: Aug 24, 1994.

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Pursuant to a congressional request, GAO provided information on: (1) the Environmental Protection Agency's (EPA) requirement that trucks use low-sulfur diesel fuel; and (2) whether the requirement increases fuel costs and makes trucks less competitive with railroads. GAO noted that: (1) EPA proceeded with the rule over industry concerns about higher costs and handling burdens when studies showed that low-sulfur fuel could extend engine life and would not compromise truckers' competitiveness; (2) EPA did not establish a uniform standard for all diesel fuel because of the desire to keep potential fuel sources for peak demand periods; (3) the price of low-sulfur fuel increased about 11 percent after the requirement took effect due to the scarcity of the new fuel, a pipeline rupture, and additional state regulations; (4) the price for low-sulfur fuel has decreased and stabilized, but the price of high-sulfur fuel, which railroads continue to use, remains about 5.3 percent lower than low-sulfur fuel; and (5) it is too early to determine the impact of the requirement on the trucking industry's competitiveness.

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