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The "compression ignition engine" was invented in 1892 by a German engineer named Rudolf Christian Karl Diesel.

His design of engine needs a particular kind of fuel which is different to the fuel needed by a different kind of internal combustion engine, the "timed spark ignition engine". That was invented by another German engineer, Karl Benz. He patented his engine in 1886.

The fuels used by those two types of engine are quite different: right from the beginning it was impressed upon car drivers that they must not put the wrong kind of fuel in their engines because, if they did try to use the wrong kind, their engines could be seriously damaged!

There were no "gas stations" or "petrol stations" in those early days so car drivers had to go to their local pharmacist or apothecary to buy a can of fuel! To be sure they bought the right kind for their Benz-engine-powered cars, they soon found it easier to ask for "Benz engine fuel", which soon got shortened to benzine and, when they needed to buy fuel for their Diesel-engine-powered cars, they naturally asked for "Diesel engine fuel", which soon got shortened to just diesel.

Further note

Petroleum gas-oil was one of the early "generic" names given to automotive engine fuels by scientists. As always, everyday use meant that it quickly got shortened: in Europe the Brits and Irish adopted the petroleum part of "petroleum gas oil", which naturally got shortened to just petrol whilst in Canada and the US they adopted the gas oil part, initially naming the fuel gasoline, which naturally got shortened to just gas.

For more information see the answers to the Related Questions shown below.

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