Today, O2Diesel reported a net loss of $1.62 million, or ($0.05) per share, for the three months ended June 30, 2005, as disclosed in its Form 10-QSB filed with the Securities and Exchange Commission. This compares to a net loss of $1.85 million, or ($0.07) per share, for the same quarter in 2004.

The market appeared pleased with the announcement, the stock today closing up over 4%. Commenting, Alan Rae, O2Diesel Chief Executive Officer, said, "The second quarter saw progress in several areas as we begin the transition from product development to commercial sales of O2Diesel".

The question for me remains though, while ethanol production appears very popular in the USA and the benefits of mixing it with diesel are environmentally tangible, is this a company that can do the logistics of fuel supply as well as the research?

We will see.