Diesel and Gasoline Prices Continue Decline

Once again this week, the price of diesel and gasoline at the pump saw a decrease over last week's prices. Nationally, the average price for a gallon of diesel fell 8.6 cents to rest at $4.03.

According to the Department of Energy's weekly report, all regions in the U.S. saw a drop in the price of diesel this past week.

Despite this continued decline in diesel prices, the national average price is still 13.8 cents above where the price per gallon was last year at this time.

The cheapest diesel can be found on the East Coast in the Lower Atlantic region, where diesel prices dropped an average of 9 cents to $3.92 per gallon.

The steepest decline in diesel prices was seen in the Midwest and on West Coast, where prices fell approximately 11 cents over last week's average price for a gallon of diesel.

California is still seeing the highest nationwide average for diesel prices although they experienced a decrease in diesel prices of 11.7 cents. Diesel is still, on average, $4.27 per gallon in the state.

Gasoline prices similarly experienced a decline this past week. Nationally, the average price for a gallon of gasoline decreased 11.9 cents to settle at $3.57. According to the report, average gasoline prices on the West Coast are still topping $4 per gallon, specifically $4.05.

Oil prices are also falling. Futures prices for December crude dropped 74 cents to settle at $85.54 a barrel Monday, according to published reports. Monday's $84.66 intraday low was the lowest price since July. U.S. crude futures were on track to end October down more than 7%, after dropping more than 4% last month.

It's unclear what direction oil, diesel and gasoline prices will take in the wake of Hurricane Sandy. Fuel product futures initially jumped reflecting fears that power outages and flooding could leave refiners struggling to restore operations The storm has brought production at U.S. East Coast refineries comes to a standstill.

However, diesel and gasoline consumption by businesses and households could also be cut sharply after New York and other large cities are shut down by the storm. Power outages lasting as long as 10 days may reduce demand further.