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The national average price of diesel dipped for the second week in a row, falling by 4.2 cents to $5.571 a gallon, the Energy Information Administration reported May 23.
A gallon now costs $2.318 more than it did at this time in 2021. (Diesel reached an all-time high of $5.623 a gallon May 9.)
EIA’s weekly survey showed that the price dropped by single digits in most of the 10 regions it covers. The Gulf Coast experienced the largest drop at 7.9 cents a gallon to $5.216. Prices increased in the Rocky Mountains, West Coast and California.
U.S. On-Highway Diesel Fuel Prices
The national average price for gasoline, on the other hand, jumped 10.2 cents a gallon to $4.593, as costs increased in every region. The West Coast less California saw the biggest increase at 14.7 cents to $5.038.
“The nice part is, at least unlike gasoline prices, we’re not hitting a record high every week,” Phil Flynn, an oil analyst with the Price Futures Group, told Transport Topics. “That’s kind of expected because the diesel got so out of whack with gasoline and now the refiners are producing more diesel than they had been at the expense of gasoline.”
Flynn added diesel inventories have risen a little bit as gasoline inventories have declined. He noted refiners are ramping up production for diesel week-over-week that can help prices go down.
“But the trajectory of prices are still high,” Flynn said. “There’s still a lot of upside risks. I am looking for the market to get a little bit of a cooling off period, hopefully after the Memorial Day holiday. And as soon as I say that, there’s going to be some kind of a glitch that will make them go higher. But I think we’ll find that happy medium here for at least a couple of weeks.”
Memorial Day can be a time when the oil market settles down. Flynn noted the refiners start to hit their stride and prices will generally level off a bit for a couple of weeks. After that, diesel trends will depend on where production is.
“I wouldn’t be surprised to see prices start to edge up just a little bit over the next day or two,” Flynn said. “But that should be it. And then we should stabilize for diesel for a couple of weeks. Now don’t look for it to be short-lived. I think once we get closer to the Fourth of July holiday, we start the process over again, we could see another run. But I’m hopeful that at least we can level off just a tad.”
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