The U.S. average price for diesel fuel increased sharply again for the week of Aug. 14, rising 13.9 cents to $4.378 per gallon and marking the third straight week of double-digit increases in the average, according to the newest U.S. government data.
The nationwide number published weekly by the U.S. Energy Information Administration (EIA) has surged 57.2 cents in the last month and is within another 53.3 cents of matching the high water level of a year ago in summer 2022. Trucking’s main fuel was up in price this week by double digits in every region and subregion of the U.S. that EIA measures, as high as 17.9 cents in the subregion of California and 17.5 cents in both the West Coast region as a whole and in the Lower Atlantic subregion of the East Coast.
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The U.S. average has been on quite a monthlong run, rising 11.2 cents for the week of Aug. 7, by 22.2 for the week of July 31, and by 9.9 cents the week of July 24 to go along with this week's more than 13-cent surge, according to EIA.
Motor club AAA’s U.S. diesel average on Aug. 15 rose 12.4 cents to $4.327 per gallon over one week ago.
“It’s unusual to see gas prices spike in the middle of the summer,” Mark Schieldrop, a spokesman for AAA Northeast, told AARP. “Normally prices slide gradually through the summer as we approach the fall. The uptick we’ve seen recently is certainly not normal.”
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Meanwhile, according to one analyst, the per-barrel price of crude oil is heading well into the $90 range—West Texas Intermediate crude actually was down slightly Aug. 15 from its level of the last week but above $81, while Brent crude still hovered north of $85—and $100 per barrel is “entirely possible.” Crude prices surged past $120 per barrel last year when fuel prices reached record levels. Oil prices are the traditional barometer for predicting where prices for its distillates are headed, while other variables like supply, OPEC manipulation of crude flow, and geopolitical events like last year's Russian invasion of Ukraine also play their part. Of late, OPEC has been cutting production in an attempt to manipulate the crude markets.
EIA's own Short Term Energy Outlook puts it this way: "The Brent crude oil spot price averages $85 per barrel in August in our forecast. Crude oil prices have increased since June, primarily because of extended voluntary cuts to Saudi Arabia’s crude oil production and increasing global demand. We expect these factors will continue to reduce global oil inventories and put upward pressure on oil prices in the coming months."
Diesel skyrockets in every region
Trucking’s main fuel rose by an identical number on the West Coast and in the Lower Atlantic. The increases were comparably significant everywhere else, starting in the most expensive place for diesel in the U.S., California, where diesel is averaging $5.518 per gallon. In the other subregion of the West Coast, the West Coast not including the Golden State, diesel climbed 17.2 cents the week of Aug. 14 to $4.71.
On the opposite side of the country, the fuel rose regionwide on the East Coast by 15.4 cents to $4.402 per gallon, also rising 13.5 cents in the New England subregion to $4.37 and by 10.4 cents to $4.499 in the Central Atlantic. In the Midwest, diesel was up for the week of Aug. 14 by 12.2 cents to $4.317, while it rose 13.5 cents to $4.095 along the Gulf Coast and by 10.6 cents to $4.394 per gallon in the Rocky Mountain region.
According to Reuters, prices for diesel and other distillates have surged in the U.S. as expectations for a soft landing and an improving economic outlook (analysts have backed off predictions of a recession this year) threaten to deplete inventories that already are low. Diesel prices are rising as traders anticipate that shortages will quickly re-emerge if the economy avoids falling into a recession later in 2023, the Reuters report said.
