Diesel prices fall for first time in 11 weeks, says Energy Information Administration

The price per gallon of diesel fell 4.9 cents to $4.086 per gallon, marking the single largest weekly decline since falling 5.1 cents to $3.678 per gallon the week of June 25.

By ·

The recent stretch of weekly increases in diesel prices paused this week, with prices going down for the first time in 11 weeks, according to the Department of Energy’s Energy Information Administration (EIA).

The price per gallon of diesel fell 4.9 cents to $4.086 per gallon, marking the single largest weekly decline since falling 5.1 cents to $3.678 per gallon the week of June 25. The last time there was a weekly decline was the week of July 2, when prices dippers 3 cents to $3.648 per gallon.

Prior to this most recent decline prices had been above the $4 per gallon mark for five straight weeks. And during the previous 11 weeks prices had risen a cumulative 48.7 cents.

In its recently updated short-term energy outlook, the EIA is calling for diesel prices to average $3.96 per gallon in 2012 and $3.73 in 2013, with WTI crude oil expected to hit $95.66 per barrel in 2012 and $92.63 in 2013.

Regardless of the fluctuation in diesel prices, shippers are cognizant of the impact diesel prices can have on their bottom line—for better or worse. And they continue to be proactive on that front, too, by taking steps to reduce mileage and transit lengths when possible as well as cut down on empty miles.

What’s more, shippers have repeatedly told LM they are constantly monitoring fuel prices, as they relate to freight rates and the overall costs of doing business.

And 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.

What’s more, due to the economics driving the increases in global oil prices, shippers really don’t have any choice in the matter, shippers say.

“Shippers will have to pay to get their goods to market even as the price of fuel increases,” a shipper told LM.. “The fuel surcharge (FSC) is not necessarily an evil thing. Shippers need to [partner] with transportation and logistics services companies and realize that without an FSC these companies would not likely be able to stay in business…but shippers need to do their homework to determine what the actual costs are and what percent they should pay to carriers.”

The price per barrel of crude oil is currently trading at $91.93 on the New York Mercantile Exchange, with worries about global economic growth driving prices down, according to an Associated Press report.

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!

Article Topics

Diesel · Diesel Prices · EIA · Oil · Oil Prices · All Topics
Latest Whitepaper
Case Study: LEAN Yields Big Results
Every day, companies across a wide range of industries use LEAN in their supply chains, warehouses and distribution centers, finance departments, and customer service centers, among other areas. LEAN practices improve safety, quality, and productivity by extracting cost and waste from all facets of an operation – from the procurement of raw materials to the shipment of finished goods.
Download Today!
From the October 2016 Issue
Over the past decade we’ve seen a major trend in regards to safety regulations for freight transport within the United States as well as for import and export shippers—that trend is the “international­ization” of rules and regulations.
European Logistics Update: Post-Brexit U.K. moving ahead, but in which direction?
Badcock Home Furniture &more: Out with paper, in with Cloud TMS
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
How API Technology Connects the Transportation Economy
Dynamic decision making is made possible through accurate, actionable data. When combined with progress in data science and the Internet of Things, technology companies that add value to direct-to-carrier APIs and combine them with high-power data analytics will create new concepts for the information economy.
Register Today!
Motor Carrier Regulations Update: Caught in a Trap
The fed is hitting truckers with a barrage of costly regulations in an era of scant profits....
25th Annual Masters of Logistics
Indecision revolving around three complex supply chain elements—transportation, technology and...

2016 Quest for Quality: Winners Take the Spotlight
Which carriers, third-party logistics providers and U.S. ports have crossed the service-excellence...
Regional ports concentrate on growth and connectivity
With the Panama Canal expansion complete, ocean cargo gateways in the Caribbean are investing to...