Subscribe to our free, weekly email newsletter!


Transportation news: Diesel prices head down for second straight week

By Jeff Berman, Group News Editor
May 17, 2011

Diesel prices decreased for just the fourth time in the last 24 weeks—and the second consecutive week—with a 4.3 cent decline to $4.061 per gallon, according to the Department of Energy’s Energy Information Administration (EIA).

This follows a 2 cent dip last week, which dropped the average price per gallon to $4.104. When diesel hit $4.078 per gallon the week of April 11, it marked the first time diesel has been above the $4 per gallon mark since the week of September 15, 2008, when it hit $4.023.

On an annual basis, the price per gallon for diesel is up $0.97 per gallon.

For a variety of reasons, including political and civil unrest in the Middle East and North Africa, diesel prices and the price per gallon for both diesel and regular gasoline has been on the rise over the last six months. And the average price per barrel for oil is currently trading at $96.21 per barrel on the New York Mercantile Exchange, dropping sharply since a two-and-a-half year high at $114.83 per barrel two weeks ago.

This current decline, according to industry analysts, could be due to a softening in demand, given a May 12 report from the EIA which indicated that the country’s crude inventories rose by 3.8 million barrels in the first week of May, and that gasoline stockpiles rose 1.3 million barrels, suggesting demand for crude and gasoline is softening, according to a Dow Jones report.

At the NASSTRAC Logistics Conference and Expo in Orlando, Fla. in April, shippers and carriers both expressed ongoing concern about the price of diesel and oil. While many said prices at current levels are still digestible, they cautioned that could quickly change depending on how quickly prices rise with summer driving season approaching.

In terms of how these prices can impact supply chain and logistics operations at a time when freight volumes are showing slow but consistent growth, many shippers have expressed concern about the pace of these diesel increases, explaining that if prices continue to rise at their current pace, it has 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.

“We are doing whatever we can to off-set the impact of high fuel prices,” a consumer package goods shipper told LM. “Even though prices are down for now, they are still higher than a year ago and that forces us to approach things differently.”

Click here for more articles on diesel prices.

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

Panjiva, an online search engine with detailed information on global suppliers and manufacturers, recently said it is opening up the “vault,” so to speak. The vault in this case is making its copious amount of trade data accessible through an Application Programming Interface (API), which enables customers to extract Panjiva’s trade data into their own database.

Freight transportation and logistics services provider Averitt Express recently announced it has rolled out improved transit times for less-than-truckload (LTL) service from the Midwest to Toronto and other cities.

Data issued by the National Retail Federation lowered its 2014 retail sales forecast, due to a slow first six months of the year (and largely negatively influenced by the terrible winter weather), but noted that retail sales are expected to be strong over the next five months to finish the year.

Anne Ferro, a ferocious advocate for greater truck safety and a constant thorn to truck drivers and some unsafe trucking fleets, says she is leaving as administrator of the Federal Motor Carrier Safety Administration. No successor has been immediately named.

Data issued by the National Retail Federation lowered its 2014 retail sales forecast, due to a slow first six months of the year (and largely negatively influenced by the terrible winter weather), but noted that retail sales are expected to be strong over the next five months to finish the year.

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