Thread: BP Diesel Ultra

There's been some posts about the pros and cons of different fuels and, wildly different opinions about who makes what and sells it to us the public so, I thought I'd add some words from my experience working in the Industry and, having a family member who owns a number of fuel outlets............

It's a little lengthy but should explain some of the facts and....make you aware that some arguments based on the merits of 1 brand of fuel to another are all a bit pointless.

Most of our fuel is not from Asia but actually sourced locally, exported as raw product (Light sweet crude) and refined O/S at large oil refineries - Singapore for example supplies over 55% of our demand for refined oil product. The majority of fuel supplied to the Northern Territory believe it or not is directly imported from Singapore.

With the recent closure of the Clyde and Kurnell refineries in Sydney and the Geelong plant in Victoria, Australia has only five operating oil refineries and while we have substantial crude oil production, these Australian refineries only source a minority of their crude oil requirements from Australian fields.
This is partly because Australia crude oil is very light and getting lighter as we further develop our oil fields. Heavy crude oils are required to produce heavier products such as lubricating oils, grease, bitumen etc. and as this occurs, Australian refineries (which in general are not designed to process large quantities of the very light crudes), must resort to heavier crude imports.

The other significant reason is that overseas crude oils can be purchased at lower prices. This is a function of the value that all oil refineries place on each possible crude they can purchase. Every refinery has a different configuration of plant and equipment and depending upon the product demand in their particular market, particular refinery infrastructure limitations, and the different product yields (petrol, diesel, kerosene) that are produced from each crude oil will each see slightly different value for every crude oil at a particular point in time. Australian refineries are no different and with the highly competitive Australian market under considerable financial pressure, refiners are always seeking ways of reducing costs, and finding cheaper crudes (or better value crudes).

In fact, the pricing of crude oils is through the use of marker crudes such as:
West Texas Intermediate (WTI ? USA)
Brent (Europe and Africa)
Dubai and Oman (Middle East)
Tapis and Dubai (in Asia/Pacific)
The main criteria for a marker crude is for it to be sold in sufficient volumes to provide liquidity (many buyers and sellers) in the physical market as well as having similar physical qualities of alternative crudes.
In addition, the marker crude should provide pricing information. WTI does this through its use of the New York Metals Exchange (NYMEX) as the basis of a futures contract where trade is equivalent to many hundreds of millions of barrels per day, even though physical WTI production is less than 1 million barrels per day.

A futures contract for crude oil is a promise to deliver a given quantity of crude oil but, this rarely occurs as participants are more interested in taking a position on the price of the crude oil. Futures markets are a financial instrument to distribute risk among participants with the side effect of providing transparency on the pricing of crude oil. It is common for you to hear the media quote the price of a barrel of oil in USD$ and related to the WTI index but for world macro-economics, it isn't really applicable to Oz.

Brent offers pricing information based more on the physical trading of oil through spot trading and forward trading but also offers futures trading but not to the same extent as WTI.

In Asia there is no futures exchange where crude oil is traded and which would provide pricing information to the same extent as WTI and Brent. In Asia, the pricing mechanism for say Tapis, a marker for light sweet crudes in the region, is based on an independent panel approach where producers, refiners and traders are asked for information on Tapis crude trades.

Tapis is used as the appropriate Australian crude marker because of the strong trade relationship Australia has with the region as a source for crude oil and also petroleum product imports. In effect - our base product is sent overseas, to be refined and blended with other local and imported product then sent back to us cheaper than using an all Australian product.......Kinda weird isn't it??

OPEC - The Organisation of the Petroleum Exporting Countries (Formed in Baghdad of all places in 1960)......is made up of 12 oil exporting/producing countries. OPEC represents a considerable political and economical force. Two-thirds of the oil reserves in the world belong to OPEC members; likewise, OPEC members are responsible for half of the world's oil exports.

OPEC does not set world oil prices but; it does set oil production levels and this is very much linked to the actual price of crude oil....(Basic economics - producing less will create strong demand resulting in a higher price)
Oil & gas prices are a bit like 'smoke & mirrors' but not the supply - price fixing is a real mix of forecasts, exploration, drilling, completion and production levels, politics, stability or instability of Government in oil producing nations etc. etc.........

In closing - What you buy from your local fuel retailer isn't all that it seems as I think many of you are now becoming aware.

The Shell distribution facility at Pinkenba Brisbane for example is just that - a major terminal for distribution of product by pipeline, road transport or sea freight. The Shell road tankers that drive out do not carry anything Shell.

There is a lubricating plant on site that blends lubricants as well as a bitumen production plant but; actual fuel (Aircraft Kero, ULP, PULP, Diesel etc) is produced (Refined) and piped to the Shell facility from either the BP or the Caltex refinery via under river pipeline (Brisbane river). I used to work at the BP facility.

Don't take my word for it - even the official Shell website states that most of the fuel is produced by competitor refineries to quote "Shell specification" unquote.....There is little doubt that the 'Shell Extra' you pump into your tank throughout SEQLD is going to be pretty much BP Ultimate so, those who state Shell is better than BP are being misguided and not aware of the facts!

This is the same for many other Fuel brands who market their product as their own.....but in reality are using fuel produced by a competitor brand......particularly in the southern states so be careful getting into a debate as to which retailers fuel burns better or produces more power!

There is now 5 but soon to be only 4 operating fuel refineries throughout Australia -
BP Bulwer Island in SEQLD (Closing in 2015)
Caltex Lytton in close proximity to BP Bulwer Island
BP Kwinana in WA
Shell Geelong in VIC (Also winding down operations) and;
Exxon Mobil Altona in VIC as well.

So......BP Bulwer Island in SEQLD will close shortly and have publicly stated that they will use Caltex product - the same for all Shell outlets as Shell doesn't have any Refining activity throughout QLD or NSW.

So most if not all fuel outlets throughout the majority of QLD and Northern NSW will be pumping Caltex fuel regardless if it is through a Shell, BP, Mobil or the many small independent outlets. The main shipping ports in FNQ (Townsville for example) import fuel direct from Singapore as it is not cost effective to truck transport from the south similar to the Northern Territory. {Coincidentally I was in Darwin all last week and am amazed that the very large LNG plant there sends ALL of its natural gas product to Japan with nothing made available for Australian consumption!}

Back to fuel......It doesn't look good at all for SQLD, NSW and the ACT with Caltex Kurnell having wound down operations and closing completely. This means that the vast majority of our fuel will be trucked in from either Shell Geelong or Exxon Mobil Altona.....or a mix of both depending on supply and demand so keep in mind that you could be filling up your pride and joy at a shiny new BP outlet with a competitors fuel (Southern States).

I don't know about you but that seems to be misrepresentation to me and surely breaking a lot of consumer protection laws. Why the ACCC hasn't jumped on this I will never know!

I have to fuel the 4WD this afternoon and I'm going to pay close attention to see if there are any disclaimers inside the fuel station actually stating - "The product being sold here may not be represented by the advertised brand" or words to that effect.....

As I've said earlier -
Be careful getting into a debate about which retailers fuel burns better, is cheaper or produces more power!

A sad but inevitable fact unfortunately.....

That information (or at least the parts I was able to understand ) confirms my long held belief that most people don't realise just how much their apparent fuel consumption figures can be distorted by comparatively small differences in the level to which their tank is filled each time and by a number of other factors.

Some vehicles are worse than others, but the difference in the fill level can be caused by a slight slope at the service station or insufficient patience dealing with the froth that comes up the filler neck.

Even without knowing all the details you have presented, I have always believed that on the occasions when I could be reasonably confident of the accuracy of the calculations, there was no discernible difference no matter what brand of fuel I used.

I have always been sceptical of a lot of the claims I hear about brand A being better than brand B and I take no notice at all of claims about being able to drive an extra x number of kilometres before filling up or x number of kilometres before the gauge showed 1/4 full.

I think your information suggests that my scepticism is justified.

My head agrees with you VNX, even though for this car I always fill to the first click only.

But my heart can't help doing when I come in at under 10l/100km or when I get near to 11. Ive actually banned myself from having the fuel economy figure showing on the message centre because it makes me tense and brings out road rage.

Originally Posted by bacicat

I've worked in most of these places and there isn't much difference between normal diesel and 'premium' diesel. A squirt of foam inhibitor into the tanker before the fill is about all that happens.

Knowing which companies do this would make the day for every Disco2 owner!

Originally Posted by Catmatt

Don't take my word for it - even the official Shell website states that most of the fuel is produced by competitor refineries to quote "Shell specification" unquote.....There is little doubt that the 'Shell Extra' you pump into your tank throughout SEQLD is going to be pretty much BP Ultimate so, those who state Shell is better than BP are being misguided and not aware of the facts!

This is the same for many other Fuel brands who market their product as their own.....but in reality are using fuel produced by a competitor brand......particularly in the southern states so be careful getting into a debate as to which retailers fuel burns better or produces more power!

The only thing your argument skips over is the addition of additives or blending at the distribution terminals.

BP Ultimate Diesel for instance isn't made at the refineries, its just low sulphur diesel with various additives added at the distribution terminals made up to BP's specifications. Likewise, various companies can blend different components (i.e ethanol to unleaded and bio diesel to diesel) to make up their final product to meet the specs which they sell. These wont necessarily be the same between the major retailers.

Similarly, I would assume premium fuels like BP Ultimate, Vortex 98, Shell V-power etc will be made from the same base 98 octane fuel but I would not be surprised if they have slightly different additives to give them the various cleaning, lubricating, etc properties that they claim.

I wont debate whether or not the different additives make up that much difference though

Originally Posted by stuee

The only thing your argument skips over is the addition of additives or blending at the distribution terminals.

Similarly, I would assume premium fuels like BP Ultimate, Vortex 98, Shell V-power etc will be made from the same base 98 octane fuel but I would not be surprised if they have slightly different additives to give them the various cleaning, lubricating, etc properties that they claim.

I wont debate whether or not the different additives make up that much difference though

I fully agree (I wasn't arguing BTW - just clearing up a few myths). What gets my goat is that in this litigious, politically correct society of ours - fuel retailers don't offer up any disclaimers to say something like...."The BP Ultimate available from this BP retailer is sourced from a base stock totally refined by Caltex with additives provided by BP".

To use an example....You buy a Samsung TV, get it home and remove it from the Samsung box to find that it is actually a Toshiba TV with Samsung badges over it.......Just like filling your 4WD at the BP forecourt not knowing there isn't a BP refinery within coee!

My disclaimer.....I am not in anyway saying that Samsung use other manufacturers branded products.

Finally - I have a great photo of a Caltex truck discharging into my local BP fuel outlet. I try and post it once I work out how to attach a pic

Originally Posted by Catmatt

Finally - I have a great photo of a Caltex truck discharging into my local BP fuel outlet. I try and post it once I work out how to attach a pic

This attachment is from the forum somewhere - FAQ's from memory. It is slightly out of date but should guide you.

How to Post Photos on the Forum.pdf

Martin

Interesting discussion, chaps.

I'm a bit anal about fuel consumption, I have spreadsheets/ databases going back to 1997, showing fuel purchased, fuel source, distance travelled, fill up cost for all the cars we've owned since then.

At the moment I'm driving a V8 Commodore, I usually get 10% better fuel consumption with one RON98 product over all the other RON98s, irrespective of where I purchase it. Suggests to me the additives do make an impact. The few times I've used RON95 the consumption has been similar to the even fewer occasions I've used RON91.

Note the comment about where I purchase. The wife will drive out of her way to fill the D3 at a certain outlet, there is always better consumption with their 'product'. When I had the D1 there was a certain outlet, unfortunately the closest fuel to where I worked/ lived, that I got consistently bad figures. If I changed to a different outlet for the same brand, consumption would move back into an average range.

So, where am I going with this? I reckon the servo the wife uses is delivering more fuel through the bowser than their readout says. Similarly, the outlet I used was delivering less. Given the wife's fill point is a small, family owned general store, I'm wondering if they do not audit their purchases against sales, while the outlet I used knew the difference but weren't concerned as it was in their favour.

The difference might only be a litre or so on a full fill, only 2% or so, but it will make a difference to calculated fuel consumption. That is probably within the tolerances set by weights and measures (or whatever they call themselves; do they still exist and test outlets?). When it gets out to 5 litres per fill you'd start to get a marked change (5 litres on a 80 litre fill is nearly 7%, which will take a low 10L/100KMs to 11L/100KMS)