Diesel prices fall another 5.1 cents, says EIA

Diesel prices continued their ongoing decline, dropping 5.1 cents to $3.846 per gallon, according to the Department of Energy’s Energy Information Administration (EIA).

This most recent decline marks the eighth straight weekly decrease and follows last week’s 5.9 cent decrease, which was the single largest weekly decline since the the week of December 19, when it dropped 6.6 cents to $3.828. And this week’s price is the lowest since February 6, when prices were at $3.856 per gallon.

Diesel prices have fallen a cumulative 30.2 cents over the last eight weeks. Prior to this eight week stretch of declining prices, the price per gallon had been above the $4 per gallon mark for 12 straight weeks.

On an annual basis, diesel is 9.4 cents less than it was a year ago.

In its recently updated short-term energy outlook, the EIA is calling for diesel prices to average $4.06 per gallon in 2012 and $4.03 in 2013, with oil pegged at $104.12 per barrel in 2012 and $103.75 in 2013.

Oil prices are currently at $83.74 on the New York Mercantile Exchange as of earlier today. An Associated Press report noted that prices are approaching and eight-month low, due to a heavy amount of uncertainty regarding the European debt and economic crisis.

This is down sharply from prices in the $106 range just weeks ago.

Even with recent declines, shippers continue to keep a watchful eye on fuel prices and are taking steps to reduce mileage and cut down on empty miles. Steps like this were cited by many shippers at the NASSTRAC Logistics Conference & Expo last month.

And as previously reported by LM, shippers continue to take steps to minimize the impact of fluctuating fuel costs. Over the years, they have maintained that this is imperative as higher diesel prices have the potential to hinder growth and increase operating costs, which will, in turn, force them to raise rates and offset the increased prices to consumers.

Robert W. Baird & Co. analyst Ben Hartford recently observed in a research note that “[f]alling fuel prices are a tailwind for truckload carriers on two fronts: 1) the lag in fuel surcharge recovery provides for greater near-term recovery in fuel expense, and 2) lower energy prices support marginally improved consumer confidence.”