National Average for Diesel Falls 2.4¢ to $5.317 a Gallon
[Stay on top of transportation news: Get TTNews in your inbox.]
The national average price for diesel dropped 2.4 cents to $5.317 a gallon, according to Energy Information Administration data released Oct. 31.
Diesel had risen 50.5 cents a gallon the previous three weeks before the current dip. A gallon of trucking’s main fuel still costs $1.59 more than it did at this time a year ago.
Diesel’s cost declined in six of the 10 regions in EIA’s survey and climbed in four. The largest drop was 7.7 cents in California; the biggest gain was 7.9 cents in New England.
U.S. average on-highway #diesel fuel price on October 31, 2022 was $5.317/gal, DOWN 2.4¢/gallon from 10/24/22, UP $1.590/gallon from year ago #truckers #shippers #fuelprices https://t.co/lPvRNZFztg pic.twitter.com/JLFZUtBwoG — EIA (@EIAgov) November 1, 2022
The national price for gasoline fell 2.7 cents over the past week and now averages $3.742 a gallon.
Recent speculation has centered on whether there will be adequate supplies of diesel as winter closes in, especially in the Northeast, and could the fuel used to run trucks, and heat homes and businesses, run out.
One truck stop network chief executive offered a response during his company’s earnings call Nov. 2.
“There is a lot of noise out there,” TravelCenters of America Inc. CEO Jonathan Pertchik said regarding diesel supplies drying up. “We have a pretty high degree of confidence that if we go dry anywhere it will be infrequent, short-lived and very focused to certain specific areas. We do not have broad, protracted, wide-ranging concerns that could meaningfully measurably affect volumes. We don’t. The way we purchase fuel, our contracts — both short and long term — give us a level of protection.”
TA sold 518,778 gallons of diesel fuel in the third quarter, 1% more compared with 513,827 a year earlier. Gallons of gasoline sold fell 11.3% to 63,861 from 72,021.
That said, Pertchik noted factors such as the recent OPEC+ supply cut, the war in Ukraine, ongoing supply chain constraints, stubborn inflation and other macroeconomic concerns are unlikely to resolve in the near term.
Another industry executive believed diesel will fall in price next year.
“In line with industry estimates, we also expect diesel fuel to be down next year by about 70 cents per gallon. Fuel, as you know, is headwind in our industry,” Forward Air Corp. Chairman and CEO Tom Schmitt said during the company’s latest earnings call Oct. 26.
Greeneville, Tenn.-based Forward Air ranks No. 27 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 1 on the air/expedited sector list.
Schmitt expected fuel to end this year between $4.93 and $5.07 a gallon.
“Next year, that number will be somewhere in the $4.20s,” he said. “We use the best estimates.”
Meanwhile, President Joe Biden has discussed imposing a windfall profits tax on energy companies if they did not increase production — with the aim of cutting costs at the pump while oil company profits soar — an unpopular possibility within the oil industry.
Oil company profits now are “a windfall of war” in Ukraine, not because they are doing something innovative, Biden said.
“Once again, the president is more worried about political posturing before the midterms than he is about advancing energy policies that will actually deliver for the American people,” American Fuel & Petrochemical Manufacturers CEO Chet Thompson said in a statement. “A windfall profit tax might make for good sound bites, but as policy, it’s bad for consumers. It’s likely to disincentivize fuel production and make matters worse for drivers.”
AFPM represents U.S. fuel refineries making gasoline, diesel, jet fuel, renewable diesel and sustainable aviation fuel — and petrochemical manufacturers.
As of Jan.1, 130 petroleum refineries were operable in the United States, according to EIA.
The world is going through an unprecedented energy change, Dakota Semler, CEO, co-founder and chairperson of electric truck manufacturer Xos Trucks, said in a recent post.
“While most people blame geopolitical factors for rising prices at the pump, the reality is that global fuel markets are inherently volatile,” he said. “No matter how far back you look, the world has been subject to unstable oil markets and their inconsistent logistics systems ever since we became dependent on fossil fuels.
“Simply put, adoption of electric vehicles represents an investment in a country’s renewable energy resources, and ultimately, its nationwide infrastructure. Investing in infrastructure is critical in building economic resilience, building wealth and prosperity, and improving overall quality of life.”
U.S. On-Highway Diesel Fuel Prices
Los Angeles-based Xos noted its vehicles and fleet management software are purpose-built for Classes 5-8 commercial battery electric vehicles that travel on last-mile, back-to-base routes of up to 270 miles or less per day.
Meanwhile, EIA reported the Nov. 1 West Texas Intermediate crude oil futures price was $88.37 a barrel, up $3.05 from a week earlier and up $4.32 from a year earlier.
Want more news? Listen to today's daily briefing below or go here for more info: