DOE Says Diesel to Rise; Lowers ’07 Price Outlook

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iesel prices will rise starting this month for seven straight months into next year before falling back again, the Department of Energy said Tuesday, though DOE lowered its average price projection for 2007 by 3 cents to $2.63 a gallon.

Diesel will rise from October’s average $2.519 a gallon to $2.721 next May, though this month’s increase will be less than half a cent and December’s will be to just $2.545, DOE said in its monthly short-term energy forecast.

Following the high price in May, diesel will recede every month next year, ending 2007 at $2.574, the department said.



Based on the 12 monthly projected figures for next year, diesel will average $2.633 for 2007. DOE said last month that trucking’s main fuel would average $2.66 next year. (Click here for previous coverage.)

Distillate fuel inventories as of March 2007 will be 2 million barrels below last season’s level but 8 million barrels higher than the previous 5-year average, DOE said. Diesel and heating oil are the two main distillate fuels.