The U.S. average retail price of diesel jumped 1.3 cents to $2.54 a gallon, according to the Department of Energy, as the price of oil rose past $52 a barrel as plans to cut production gelled.
It was the highest average price for diesel this year, and trucking’s primary fuel has increased 6 cents per gallon in December, according to DOE.
All regions posted higher average prices that were also above year-ago prices. Gasoline increased 4.5 cents a gallon to $2.309.
Meanwhile, oil prices rose past the 17-month highpoint set on Dec. 13 when producers’ pledged additional cuts.
West Texas Intermediate crude futures on the New York Mercantile Exchange closed at $53.82 per barrel Dec. 26, compared with $52.12 on Dec. 19.
Oil prices are set to recover next year as production cuts help re-balance an oversupplied market, Saudi Arabia’s Energy Minister Khalid Al-Falih said last week, according to Bloomberg News. OPEC and 11 nations from outside the group including Russia have agreed to trim about 1.8 million barrels a day from January.
Also, oil rose further after Iraq said most international oil companies working in the country, along with the semi-autonomous Kurdish region, have agreed to cut crude output to fulfill an OPEC accord, Bloomberg reported Dec. 26.
Oil’s climb has helped to spur sales of bulk tankers used to haul petroleum products or water and chemicals for fracking operations, said Frank Maly, director of commercial vehicle research and analysis at ACT Research Co.
Earlier this year, DOE’s Energy Information Administration said hydraulic fracturing has allowed the United States to increase its oil production faster than at any time in its history. In March, it estimated oil production from hydraulically fractured wells now makes up about half of total U.S. crude oil production.