Diesel Price Falls 11.5 Cents to $2.732 a Gallon

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he U.S. retail diesel average price fell 11.5 cents to $2.732 a gallon, the Department of Energy said Monday.

The decline follows steady drops in the price of crude oil, which fell from an all-time high of $70.85 a barrel Aug. 30 after Hurricane Katrina hit, to $63 Friday as supply fears eased.

Meanwhile, DOE reported that the nationwide gasoline average price dropped 16.9 cents to $2.786 a gallon, still 92 cents over last year.

But wholesale gasoline prices rose Monday on reports of a potential new hurricane forming, Tropical Storm Rita, which was on a track to cross Florida Tuesday and move into the Gulf of Mexico later this week.

Both fuels were coming off post-Labor Day records two weeks ago, when diesel hit an all-time high of $2.898 a gallon, while gasoline soared to $3.069. Last week, diesel fell 5.1 cents to $2.847 while gasoline fell 11.4 cents to $2.955.

Last Wednesday’s weekly DOE inventory report showed lower crude oil and distillate fuel inventories for the previous week but an increase in gasoline supplies. Diesel is a distillate fuel. (Click here for previous coverage.)

Despite the decline, diesel was still 82 cents higher than last year, which would add $164 to a trucker pulling a 200-gallon fill up over the same week last year.

The trucking industry burns about 665 million gallons of diesel a week, which would add about $545 million in costs over the same week last year.

The average price fell in all five DOE regions, led by a 13.4-cent drop in the Midwest to $2.648 a gallon and a 12-cent decline in the Gulf Coast region to $2.677.

California, which DOE breaks out separately, continued to have the highest price overall, at $3.06, though that was down 9.8 cents from the previous week.

Each week DOE surveys 350 filling stations to compile a national snapshot retail price.