Diesel prices down for fourth straight week

Average weekly price is nearly 20 cents below 2010 high

By ·

Diesel prices continued their downward trend, with prices falling for the fourth straight week, according to data released this week by the Department of Energy’s Energy Information Administration (EIA).

Average diesel prices for the week of September 6 at $2.931 per gallon were down 0.7 cents from the week of August 30. Prices have been heading down since reaching $2.991 the week of August 9, according to EIA data.

Even with the decline over the last four weeks, the current average price per gallon of diesel is 28.4 cents higher than a year ago, and prices have been below the $3 per gallon mark for the past 15 weeks. And the current average price per gallon of diesel is 19.6 cents below the 2010 weekly high of $3.127 per gallon from the week of May 10.

The most recent prices match up with the EIA’s recent Short Term Energy Outlook, which is now calling for 2010 average diesel prices to be $2.93 per gallon and $3.10 in 2011.
As for oil prices, the EIA is calling for 2010 crude oil prices to hit $79.13 per barrel and 2011 prices at $83.50 per barrel. This is below current oil prices, which are at $73.51 (as of press time). Various report have indicated current oil prices have been due to higher inventories which is a sign of weaker demand and slowing economic growth. Another reason for declining prices is that summer driving season is over, which means fewer people are driving.

A recent Bloomberg report noted that oil prices have slipped six percent in the last month and have increased six percent in the last year. It added that oil stockpiles probably rose 1 million barrels last week from 361.7 million in the week ended Aug. 27 (official data was not available at press time).

As LM has reported, even though diesel prices appear to be in check for the time being, freight transportation stakeholders maintain that there is no real rhyme or reason when it comes to assessing the string of rising and falling fuel prices.

Some experts say that the there has never been a period of volatility in fuel prices like there has been in the last year. And with prices currently down by no means indicates prices will stay down or sharply go up.

If diesel prices do remain down, it is likely to have a significant impact on both shippers and carriers. But with the amount of volatility regarding fuel prices, the direction prices eventually head in is uncertain.

A shipper recently told LM that when it becomes time to negotiate rates, carriers will be talking a lot about the cost of fuel and using it as a leverage point for general rate and line haul increases. And because of this, the shipper explained that shippers must be acutely aware of what percentage of their invoice cost is actual fuel surcharge.


About the Author

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. Contact Jeff Berman

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!

Latest Whitepaper
Managing Global Transportation: How NVOCCs can operate more profitably
Global transportation isn’t getting any easier to manage. With new rules and regulations to learn, new compliance requirements to adhere to, and new customers and business partners to onboard, navigating the complexities of the global market can be difficult for any company. To fully leverage their global supply chains, firms need a robust, global transportation management system that helps them navigate this ever-changing environment.
Download Today!
From the July 2016 Issue
While it’s currently a shippers market, the authors of this year’s report contend that we’ve entered a “period of transition” that will usher in a realignment of capacity, lower inventories, economic growth and “moderately higher” rates. It’s time to tighten the ties that bind.
2016 State of Logistics: Third-party logistics
2016 State of Logistics: Ocean freight
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Getting the most out of your 3PL relationship
Join Evan Armstrong, president of Armstrong & Associates, as he explains how creating a balanced portfolio of "Top 50" global and domestic partners can maximize efficiency and mitigate risk.
Register Today!
EDITORS' PICKS
Regional ports concentrate on growth and connectivity
With the Panama Canal expansion complete, ocean cargo gateways in the Caribbean are investing to...
Digital Reality Check
Just how close are we to the ideal digital supply network? Not as close as we might like to think....

Top 25 ports: West Coast continues to dominate
The Panama Canal expansion is set for late June and may soon be attracting more inbound vessel calls...
Port of Oakland launches smart phone apps for harbor truckers
Innovation uses Bluetooth, GPS to measure how long drivers wait for cargo