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The U.S. fuel oil market is becoming increasingly dominated by ethanol and diesel, leaving many* * Refineries are making no money due to overproduction of gasoline amid a global recession and reduced demand. Although crude oil prices have fallen by more than 100 US dollars per barrel between July and December 2008, profits from diesel and heating oil are still quite good, while profits from gasoline are decreasing. As a result, refineries have been forced to process less crude and increase exports to reduce domestic supply gluts and support prices. In the four weeks to November 21, the total volume of oil products supplied to the U.S. market averaged 19 million barrels per day, compared with 20.9 million barrels per day in the same period in 2007. Gasoline supplies fell 3.3% to 9 million barrels per day. At the same time, the United States' ethanol production increased from 260,000 barrels/day in September 2005 to 640,000 barrels/day in September 2008, and it also imported 80,000 barrels/day, replacing the United States' gasoline demand of 750,000 barrels/day. Approximately 500,000 barrels per day of replacement is the direct result of increased ethanol use, and the remainder is to meet cyclical demand. Although reducing gasoline consumption is an energy policy in the United States, during the rapid rise in oil prices from 2007 to 2008, the demand for gasoline quickly decreased due to a significant increase in the amount of ethanol blended. Additionally, the estimated fossil fuel component of gasoline has decreased from 136 billion gallons per year (8.87 million barrels per day) to 125 billion gallons per year (8.15 million barrels per day), and the ethanol content (under the Renewable Fuel Standard) has increased from 55 billion gallons per year (358,600 barrels per day) to 258 billion gallons per year (1.68 million barrels per day). The general trend of reduced demand for fuel oil products and the use of ethanol as a gasoline blending component is reinforced by increased U.S. and global demand for diesel fuel. According to information from the International Energy Agency, although the equipment structure of global refineries is configured to produce the same amount of gasoline and diesel, in 2005, for every 1 gallon of diesel used in the world, approximately 0.75 gallons of gasoline were used. However, in the United States, approximately 1.97 gallons of gasoline are consumed for every 1 gallon of diesel consumed, making the United States a unique gasoline market. Overall, the global fuel oil market is now in a stage of structural excess of gasoline production capacity (mainly in the United States) and shortage of diesel production capacity (especially in Asia). The situation means U.S. refiners are competing with foreign gasoline exporters and struggling to produce enough diesel to sell overseas, which is why U.S. diesel exports have grown faster than gasoline exports in the past few years. Analysts predict that U.S. refineries will reduce crude oil processing capacity by 500,000-1 million barrels per day in the next 12-24 months to cope with weak demand. However, over a longer period of time, U.S. refineries will build new installations to increase middle distillate production and take advantage of the opportunity of increased global diesel demand to improve economic efficiency.