The average price for diesel fuel jumped 8.8 cents this week, rising to $3.763 per gallon versus $3.695 during the week of July 16, according to data tracked by the Energy Information Administration (EIA). However, the agency’s data also noted that diesel remains 16.6 cents per gallon cheaper versus the same week in 2011.
Diesel at the pump increased in every region of the U.S., rising the most on the West Coast (10.7 cents per gallon higher), the Lower Atlantic (10.5 cents higher), the Gulf Coast (9.7 cents higher), along with the Midwest and California, where per-gallon prices shot up 9 cents week-over-week.
Gasoline also underwent a similar spike as well, rising 6.7 cents to reach a U.S. average of $3.494 per gallon compared to $3.427 per gallon during the week of July 16. Still, gasoline remains 20.5 cents per gallon cheaper when compared to the same week in 2011, EIA’s data indicated.
The cost of gasoline at the pump increased in every area of the country except the Rocky Mountain region, where prices declined 1.6 cents per gallon, the agency said. The biggest week-to-week per-gallon price increases for gasoline occurred in Gulf Coast and New England (9.3 cents per gallon higher), followed by the Central Atlantic (8.2 cents higher) and East Coast as a whole (8.1 cents higher), EIA noted.
The agency noted one interesting trend that continues to gain strength where diesel is concern: the ongoing increase in distillate exports, specifically diesel for transportation use and heating oil, that’s been one of the main drivers behind the U.S. changing from a net petroleum product importer to net petroleum product exporter over the last several years.
For example, EIA’s monthly data for April indicate that net exports of distillate fuels reached 980,000 barrels per day (bbl/d), the highest volume ever for monthly U.S. trade data reporting – reflecting both a near-record level of exports and the lowest level of monthly imports in more than 25 years.
In the first four months of 2012, gross distillate exports averaged 947,000 bbl/d, which is a 215,000-bbl/d (29%) increase over the same period in 2011, the agency said.
The reason behind the sustained high levels of gross distillate exports from the U.S. turns on growth in global demand for distillate fuels, especially in the developing economies not part of the Organization for Economic Cooperation and Development (OECD) sphere of nations – and that growth is keeping wholesale prices for distillate fuels high compared to prices for other fuels, with that price difference encouraging distillate production of at U.S. refineries.
However, while global demand for distillate keeps increasing, lower consumption in the U.S. is reducing the need to import distillate. Thus, through April of this year, U.S. distillate consumption is down 112,000 bbl/d (3%) compared to the same period in 2011 – though in part as a result of reduced consumption of heating oil during the mild winter, the agency said.
Yet that significantly reduced levels of distillate imports, EIA pointed out, which through April 2012 were down 41% year-over-year to some 98,000 bbl/d; the lowest monthly total since August of 1985.