Diesel prices fall nearly 6 cents

While diesel prices were making a relentless upward push earlier in the year on the way to $4 per gallon and above, the opposite is clearly occurring now.

The Department of Energy’s Energy Information Administration (EIA) reported this week that diesel prices slid 5.9 cents to $3.897 per gallon, marking the single largest weekly decline since the week of December 19, when it dropped 6.6 cents to $3.828 and the lowest price since February 6, when it checked in at $3.856 per gallon.

In the last seven weeks, diesel prices have fallen a cumulative 25.1 cents. And prior to this most recent decline, the price per gallon had been above the $4 per gallon mark for 12 straight weeks.

On an annual basis, diesel is 5.1 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 $89.37 on the New York Mercantile Exchange. An Associated Press report noted that Spain’s escalating financial crisis and a renewed focus on Europe’s sputtering economy has had a “dragging effect on global crude demand.” 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.