Subscribe to our free, weekly email newsletter!


Diesel prices are down another 2.5 cents per gallon

By Jeff Berman, Group News Editor
August 23, 2011

Diesel prices fell for the fourth straight week, decreasing 2.5 cents to $3.810 per gallon, according to the Department of Energy’s Energy Information Administration (EIA).

This follows declines of 6.2 cents, 4 cents and 1.2 cents from the previous three weeks. Prior to the last four weeks of downward prices, diesel saw a cumulative 9.9 cent gain over a three week period. Current prices are 31.4 cents below the 2011 high of $4.124 per gallon the week of May 2.

The current price per gallon for diesel is at its lowest point since the week of February 28, when it was at $3.716 per gallon.The price per gallon for diesel fuel has not exceeded the $4 mark since the week of May 16, when it hit $4.061.

Compared to last year at this time, diesel prices are up 85.3 cents. In its short-term energy outlook, the EIA is calling for diesel prices to average $3.86 per gallon in 2011 and $3.95 in 2012, with oil pegged at $98.43 per barrel in 2011 and $102.50 in 2012.

Oil barrel prices are currently trading at around $85.50 per barrel on the New York Mercantile Exchange, with the current trading range of between $80 and $90 per barrel is still well above last year’s average of $79.64 per barrel, which means gasoline pump prices should remain higher than last year’s levels, according to an Associated Press report.

As LM has reported, given the fluctuation—and still high prices—of diesel, shippers and carriers remain concerned about the price of diesel and oil. While many have indicated that prices at current levels are still digestible, they cautioned that could quickly change depending on how quickly prices rise.

And even with declines in prices in recent weeks, the focus from a supply chain perspective for managing fuel price ebbs and flows—for shippers—is more on utilization and efficiency by doing things like driving empty miles out of transportation networks.

While diesel prices appear to be in check to a large degree for the time being, many industry observers maintain there is no real rhyme and reason in terms of fluctuating fuel prices.

“There has never been a period of volatility in fuel prices like there has been in the last year,” said Mike Regan, president of TranzAct Technologies and a frequent blogger for LM, in a recent interview. “That means the fact that prices are down is no indication that the prices are going to stay down or rise sharply.”

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

XPO Logistics announced second quarter earnings and the acquisition of two companies, New Breed Logistics, a non asset-based 3PL focusing in contract logistics services, for roughly $615 million, and Atlantic Central Logistics, a 3PL provider of last-mile logistics services, for roughly $36.5 million.

The report, entitled “Outlook for the Domestic Transport and Logistics Market in 2H14 and Beyond,” takes the view that strong freight levels in the second quarter have left trucking companies in a good position: one in which they need to come up with new plans to handle rising demand. But even with that positive momentum afloat, the report observes that there are some familiar challenges intact, such as a lack of qualified drivers and the regulatory drag from the new hours-of-service rules that took effect in July 2013.

Flags of Convenience are a fact of life in the commercial maritime trade, but several European political action groups are worried that they will pose a threat to the Continent’s air cargo industry.

For May, which is the most recent month for which data is available, the SCI is -7.5, following April’s -7.5. FTR said this reading represents a still-tight capacity environment, as utilization rates hover between 98 percent and 99 percent.

With a 1.1 cent drop to $3.858 per gallon, this follows declines of 2.5 cents, 1.9 cents, and 0.7 cents over the previous three weeks, with the cumulative four-week decline at 6.2 cents.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA