Diesel fuel prices continued dropping the week of Dec. 19, according to the government and motor club AAA, setting some more milestones approaching the end of 2022 in their possible road to recovery from the sky-high and record prices that marked much of this year.
The U.S. diesel average dropped 15.8 cents to $4.596 per gallon, according to the U.S. Energy Information Administration (EIA), and 15.1 cents to $4.766 by AAA’s measure. EIA reports its diesel and gasoline data weekly and by region of the country. AAA aggregates its data daily, weekly, monthly, and state by state.
Diesel still is 97 cents above where it sat a year ago at this time, according to EIA. AAA still has diesel $1 above—$1.178—its year-ago level.
See also: Diesel hits lowest average price since February
Fuel reached plenty more milestones for the week of Dec. 19. Diesel is dropping now in large chunks, as is gasoline. According to EIA, the U.S. diesel average slid by double digits for the third week in a row, following a 21.3-cent decline the week of Dec. 12 (to the lowest average price since February) and a 17.4-cent decrease the week of Dec. 5. The average has dropped now almost 55 cents in December and has fallen for six consecutive weeks, giving trucking a welcome gift for the holidays.
Revised predictions for diesel's course
The diesel average is defying EIA’s own prediction as recently as November, when the federal data aggregator said prices would average more than $5 per gallon for the rest of 2022 into 2023. Earlier this month, however, EIA revised its Short-Term Energy Outlook, saying that the average in 2023 for diesel will drop to $4.48 per gallon thanks to higher refinery utilization, pumping higher supplies into fuel markets coupled with lower demand.
See also: Little things add up when it comes to improving efficiency
Translation: Refineries are forecast to produce more distillates—diesel for the trucking industry, jet fuel, and home heating oil—as oil prices continue to moderate. West Texas Intermediate ($75.69 per barrel on Dec. 20) and Brent crude ($80.18 per barrel on Dec. 20) are still hovering around $80, well below the highs of near $120 per barrel earlier this year.
The decline in fuel prices is so profound that gasoline is nearing $3 per gallon. The U.S. average for gas for the week of Dec. 19 was down 11.9 cents to $3.12 per gallon, or 17.5 cents below the price it stood a year ago, according to EIA. AAA has a near-identical gasoline average of $3.123, or 12.2 cents below a week ago and 18.5 cents below a year ago. Gas prices are at a 15-month low, and they sit below $3 in 19 states, according to AAA.
