On-highway diesel drops 21.6 cents

"I think the market is kind of tired of all the [oil] volatility," said Mike Zarembski, senior commodity analyst at brokerage OptionsXpress Inc. in Chicago. "We'll probably be in wait-and-see mode until we know how all these (bailout) scenarios play out."

The Trucker News Services

10/14/2008

Weekly, on-highway diesel prices dropped 21.6 cents this week as reported by the Energy Information Administration (EIA).

Delayed a day because of the Columbus Day federal holiday, today’s EIA data shows the national average falling to $3.659, down from $3.875 the week before.

In the Lower Atlantic reporting region, diesel actually plummeted 24.1 cents, to $3.655 from $3.896 the week before, and West Coast region prices were down 22.5 cents, to $3.622, compared with the prior week’s $3.847.

"We may be seeing the start of some stability. I think the market is kind of tired of all the [oil] volatility," said Mike Zarembski, senior commodity analyst at brokerage OptionsXpress Inc. in Chicago. "We'll probably be in wait-and-see mode until we know how all these (bailout) scenarios play out."

Light, sweet crude for November delivery rose 56 cents to $81.75 in midday trading on the New York Mercantile Exchange after earlier rising as high as $84.83.

Zarembski predicted oil would trade in a range of $75 to $85 a barrel in the short-term but said further signs of demand destruction could send prices lower.

"The outlook for oil prices is still very much bearish as the risk of global recession — or at least a global slowdown — remains," said Peter Luxton, analyst at Informa in London, who expects prices to drop to the $60- to $70-a-barrel region next year.

He said prices may hover around the current levels until mid-November, when the OPEC meeting will be held. OPEC member countries including Iran have called for a production cut to stop the decline in oil prices, but markets are uncertain how effective that will be.

To see diesel prices for the rest of the nation, click here.