What’s In A Crude Oil Barrel? A Breakdown Of Crude Oil Refined Products

When it comes to crude oil, shippers and carriers hold a strategic interest. Because crude oil accounts for roughly 50% of the final cost of diesel, fluctuations in crude oil prices directly affect what carriers pay at the pump. Slight changes in supply and demand for one crude oil refined product often result in price changes in other refined outputs. This close relationship between the oil and gas industries means that understanding what goes into a crude oil barrel is essential. For shippers and carriers, this knowledge leads to more accurate forecasting and stronger, more informed partnerships. 

Key takeaways

• Crude oil is the dominant driver of diesel costs: Crude oil accounts for roughly 50% of the final cost of diesel, meaning price swings at the crude level translate directly into higher transportation costs for shippers and carriers.
• Refined products are closely interconnected: Supply and demand shifts for one refined product such as gasoline or jet fuel can ripple across other products, making the oil and gas markets highly interdependent and difficult to monitor in isolation.
• Shippers must track crude oil market movements: Because crude oil prices fluctuate daily based on global supply, geopolitical events, and production decisions, shippers who fail to monitor these dynamics risk absorbing unnecessary fuel cost exposure.
• Market-based reimbursements enhance control of fuel cost volatility: Solutions like Fuel Recovery synchronize fuel surcharges with the time, price, tax, and location of each shipment, ensuring shippers pay a fair and accurate price for the fuel carriers consume. 

How much oil is in a barrel of crude oil?

A 42-gallon crude oil barrel contains approximately 45 gallons of salable refined products. The additional volume results from processing gains that occur during refining. Refined outputs include ULSD, kerosene/jet fuel, HGL, residual fuel, and others. Crude oil prices are measured in barrels, while production totals across all producing countries are measured in million barrels per day (mmbd).

According to the EIA, Brent crude oil was expected to average $59/barrel in 2026. Over the past decade, prices have ranged as high as $110/barrel and as low as $30/barrel, a spread that illustrates the significant cost exposure shippers face when fuel reimbursements are not aligned to market conditions. 

What is the product breakdown of products made from a barrel of crude oil?

Refining crude oil results in a range of products that serve distinct purposes across industries, from fueling passenger vehicles to powering aircraft and generating electricity. Price dynamics for petroleum products shift based on geography, market fundamentals, industry demand patterns, and refining complexities. Understanding the composition and allocation of refined products within a crude oil barrel provides the foundation for effective fuel cost management. 

Gasoline

Gasoline accounts for 20 gallons, or 45%, of a 45-gallon barrel of refined products, making it the largest single output. It is primarily used as fuel for standard passenger vehicles, but also powers boats, power tools, and small engines. Gasoline is commonly sent to fuel blending terminals where blending agents are added to meet ethanol requirements.

Retailers typically sell gasoline in three grades: Regular, Midgrade, and Premium, also referred to as unleaded, super, or super-premium. Each retailer may include brand-specific additives to differentiate their products. 

Ultra-Low Sulfur Diesel (ULSD) and Heating Oil

ULSD, often used interchangeably with heating oil and biodiesel, is the second-largest portion of a refined product barrel at roughly 11 gallons, or 25%, of finished output. Together, ULSD and heating oil account for approximately 12 gallons per barrel. This versatile fuel supports agricultural equipment, heavy-duty transportation, home heating, and refrigerated equipment.

Due to their comparable composition, ULSD, heating oil, and biodiesel are often priced interchangeably. Regional price dynamics can create significant commodity price variances. The primary difference in selling price is taxation: road diesel is subject to fuel taxes further down the product supply chain, which shippers must account for when budgeting fuel costs. 

Kerosene and Jet Fuel

Kerosene accounts for roughly 4 gallons, or 9%, of the refined products derived from crude oil. This light petroleum distillate is commonly used as fuel in heaters, lamps, cooking stoves, and water heaters. Multiple grades of kerosene exist, though specifications vary depending on means of utilization.

Kerosene-type jet fuel is created via similar refining techniques, though distinct specifications through aircraft configuration differentiate generic kerosene from jet fuel. Kerosene-type jet fuel has both commercial and military aviation.

Hyrdocarbon Gas Liquids (HGL)

HGL typically make up approximately two gallons, or 4%, of refined products from a crude oil barrel. HGL serve as feedstock for producing various chemicals, plastic products, and synthetic rubber. They are also used as fuels for heating, cooking, transportation, and as additives for gasoline and blending agents for other crude oil products. 

Residual Fuel

Residual fuel is a more general classification for fuel oils that ultimately remain after distillates and lighter HGL has refined away during the refining process. The production of residual fuels makes up one of the smallest portions of a barrel of refined products in the United States, accounting for just 1 gallon, or 2%, of refined output.  

Residual fuels are segmented into two key categories, Number 5 and Number 6. Number 5 residuals are used in powerplants and steam-powered vessels. Number 6 residuals are used for electric power generation, space heating, and ocean vessels as bunker fuel, which has greatly been greatly affected by the marine shipping regulatory landscape.

Why should shippers care about crude oil prices?

Crude oil accounts for approximately 50% of the final cost of diesel, which means even modest price movements at the crude level ripple directly into transportation costs. Understanding the intricacies of crude oil and its refined derivatives is an important part of a shipper's strategic role. More critical, however, is how shippers respond to market shifts in crude oil prices.

One effective strategy is to implement market-based fuel reimbursements. This approach aligns shipper operations with the cost fluctuations of crude oil, helping create a more balanced and sustainable business model. Breakthrough's Fuel Recovery solution is the transportation industry's only market-based fuel reimbursement solution. By implementing Fuel Recovery, shippers can align their operations with the dynamic oil market, keeping their business models agile and competitive. can lead to substantial cost savings. 

Shippers using Fuel Recovery on average see a 20% reduction in truckload fuel spend, along with improved miles per gallon (MPG) across their fleets and stronger carrier partnerships.

How to navigate crude oil price fluctuations with Fuel Recovery 

Crude oil prices have a direct and significant impact on fuel costs. By taking a proactive approach through market-based fuel reimbursements, shippers can better manage those fluctuations, reduce exposure to volatile pricing, and achieve meaningful cost savings over time. Learn how Fuel Recovery can reshape your transportation network strategy.

Frequently asked questions about a barrel of crude oil

Why does a 42-gallon crude oil barrel produce more than 42 gallons of refined products?

The refining process causes crude oil to expand in volume. This phenomenon, known as a processing gain, means a 42-gallon barrel of crude yields approximately 45 gallons of salable refined products.

What is the most important refined product from a crude oil barrel for shippers?

ULSD is the most operationally significant refined product for shippers. It accounts for roughly 25% of each refined barrel and is the primary fuel for heavy-duty diesel trucks. Because crude oil makes up approximately 50% of diesel's final cost, crude oil price movements have a direct and measurable impact on freight fuel costs.

How often do crude oil prices change, and how should shippers respond?

Crude oil prices fluctuate daily based on global supply and demand signals, geopolitical events, and production decisions by major oil-producing nations. Shippers respond most effectively by using market-based fuel reimbursement programs, such as Breakthrough's Fuel Recovery solution, which automatically adjust reimbursement rates to reflect real-time crude oil market conditions rather than lagging indices.

What is the difference between Brent crude and WTI crude, and which matters more for U.S. diesel prices?

Brent crude is a global benchmark priced from North Sea oil, while West Texas Intermediate (WTI) is the primary U.S. benchmark. Both influence U.S. diesel prices, but WTI has a more direct relationship with domestic refining costs. The EIA uses Brent as the global reference point for price forecasts.

How does crude oil barrel pricing affect fuel surcharges?

Traditional fuel surcharge programs are typically indexed to retail diesel prices, which lag crude oil market movements by days or weeks. When crude oil prices spike, shippers on fixed surcharge tables absorb the gap. Market-based reimbursement solutions track crude oil and wholesale diesel prices in real time, providing more accurate cost alignment between shippers and carriers.