Diesel prices remain above $3 per gallon mark despite sequential decline

By Jeff Berman, Group News Editor
November 23, 2010 - LM Editorial

While the price per gallon of diesel fuel remains above the $3 mark there has been a fair amount of fluctuation in recent weeks, according to data from the Department of Energy’s Energy Information Administration (EIA).

For the week of November 22, the EIA reported that the average price per gallon of diesel is $3.176 per gallon. This is a 1.3 cent drop from the $3.184 per gallon for the week of November 15, which was the highest level diesel prices have hit since $3.288 per gallon from the week of October 27, 2008. The week of November 15 is now the high water mark for 2010 diesel prices, topping $3.127 per gallon from the week of May 10. The current average price per gallon of diesel is 38.4 cents higher than it was a year ago, said EIA.

Diesel prices have been at $3 per gallon or more for ten consecutive weeks. Prior to the week of October 4, when diesel prices hit $3.00 per gallon, the price per gallon of diesel was below the $3.00 mark for 18 straight weeks. But the recent rise in prices is in line with gains in the price per barrel of crude oil, which has been slightly more than $80, on average, during the same period, although it has been trending downward recently.

As of press time oil barrel prices were slightly above $81, with media reports citing Ireland’s debt crisis and tight supplies at refineries as drivers for the recent decline, with the price per barrel down 7 percent from a two-year high of $87.81 per barrel from earlier this month, according to a Dow Jones report.

The EIA is calling for 2010 crude oil prices to hit $78.80 per barrel and 2011 prices at $85.17 per barrel, according to its short-term energy outlook. Both figures are above previous estimates of $77.97 per barrel for 2010 and $83.00 per barrel for 2011. 

A shipper responding to a recent Logistics Management reader survey on fuel costs said in order to be efficient and profitable while dealing with fluctuating fuel prices and fuel surcharges is to hedge any variability with a Fuel Price Index based on the EIA national average.

“This will give some assurance that any small increases are absorbed by the carrier with major increases being shared by the shipper and carrier,” said the shipper. “Using such a vehicle will ensure that carriers will not pull the cost of fuel back on the shipper and in even worse case scenarios use fuel increases to add to their operating margins.”



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

Logistics Management Group News Editor Jeff Berman had an opportunity to interview Derek Leathers, President and Chief Operating Officer of Werner Enterprises, at this month's NASSTRAC Shippers Conference and Transportation Expo in Orlando. They discussed various aspects of the truckload market, including prices, fuel, and regulations.

During this webcast our presenters will apply the findings of the 23rd Annual Trends & Issues in Transportation and Logistics Study to the world of shipper-carrier decision making. They'll examine the primary aspects that will influence the future direction for shipper-carrier decision-making.

For February, the month for which most recent data is available, the SCI dropped to -1.0 from January’s 2.6, with FTR explaining that the short term positive impact from one-time adjustments for rapidly dropping diesel prices and the suspension of the 2013 motor carriers hours-of-service expires later this year.

Seasonally-adjusted (SA) for-hire truck tonnage in March was up 1.1 percent on the heels of a revised 2.8 percent (from 3.1 percent) February decline, with the SA index at 133.5 (2000=100). This is off 0.3 percent from the all-time high for the SA of 135.8 from January 2015 and is up 5 percent annually.

Intermodal volume was up 8.1 percent annually at 280,016 containers and trailers. This outpaced the week ending April 11 at 270,463 and the week ending April 4 at 271,127. AAR said this tally marks the second highest weekly output it has ever recorded as well as the first time container and trailer traffic was higher than carloads for a one-week period.

About the Author

Jeff Berman, 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.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA