No, Gasoline is highly refined compared to oil. Diesel isn't as much. So "Turning fuel into energy" is really "Turning Oil into Fuel using chemicals and energy

No, Gasoline is highly refined compared to oil. Diesel isn't as much. So "Turning fuel into energy" is really "Turning Oil into Fuel using chemicals and energy which in turn can be turned into energy" You still need a refinery and a very large distribution network consisting or trains, trucks, and pipelines. Your assumption of transmission energy loss is silly when you compare the required energy of transporting things like oil and water around.