Big Drop for Diesel; Oil Under Pressure; Libya Returns
September 26, 2011
National on-highway diesel prices dropped 4.7 cents on average from last week, accelerating from the previous week's 2.9 cent drop. Diesel was $3.786 per gallon.
Prices dropped significantly in every region, but in some places more than others. Midwestern prices fell off the most, 6.1 cents, to land at $3.738, second cheapest. The Gulf, as is often the case, held the lowest price, at $3.730.
California is the only region still above four bucks, losing 2.3 cents to land at $4.039.
Oil gained 39 cents to finish at $80.24 per barrel. Prices face downward pressure from both sides of the Atlantic: a six-month low on home sales in the U.S. plus continued high unemployment, and a European debt crisis that seems to worsen by the minute.
But there is a little bit of good news: Libya has resumed partial oil production for the first time since revolution erupted in February. At 31,900 barrels per day, it's a modest start compared to 1.5 million barrels just prior to the turmoil. However, the newly free country likely won't achieve full steam for another year or so. The transitional government has pledged to honor all pre-ouster contracts, but whether that will prove true remains to be seen.