The increase in crude oil prices – and therefore diesel prices – is led by recovering demand and suppressed supply, the roll-out of the COVID-19 vaccine, and falling inventories, analysts say.
Oil prices bounced back last week, jumping to more than $30 a barrel. While some see this as a positive, there might be more to consider below the surface, both literally and metaphorically.
Diesel prices are once again down this week, dropping an average of 39 cents a gallon since last week and by $1.114 since last year.
After West Texas International (WTI) crude prices almost ended last week with historic low of $17.31 per barrel before eventually settling at $18.27, the benchmark price for crude oil in the U.S. dropped to negative $37.63 late Monday.
A sudden war in crude oil prices between Russia and Saudi Arabia could mean a drop in diesel and gasoline prices at American fuel pumps. But the longer-term implications are more worrying.
U.S. diesel prices were up nearly 2 cents per gallon from a week ago and more than 6 cents per gallon compared to a year earlier, as crude oil prices rose to their highest since early July.
Despite tensions in the Middle East, average diesel fuel prices last week dropped almost 2 cents from the week before, although they’re still 71 cents higher than a year earlier.
Expected prices for trucking’s primary fuel as well as for gasoline have been revised higher, due largely to anticipated higher prices for crude oil, according to a new Energy Department report.
The average price of a gallon of diesel fuel in the U.S. hit more than $3.15 last week, and in many parts of the country it is much higher than that.
The outlook for national average on-highway diesel prices is for them to be higher this year and in 2019 than they were last year and in 2016, but they should at least be fairly stable during this time, according to the latest Short Term Energy Outlook from the U.S. Energy Department.