By the time oil has gone through the refining process to get to diesel and by the time diesel gets to distribution centers and the local truck stop, it takes a week or two or more to catch up to the price of oil and whether the price direction is up or down.
Average on-highway diesel prices increased by 3.8 cents a gallon Monday to right above the $3-a-gallon mark at $3.010.
Last week made the sixth week in a row that the national average had dropped, according to figures from the U.S. Energy Information Administration (EIA).
Analysts kept saying oil [and therefore diesel] were headed back up. They just took their own sweet time doing it. In fact, The Associated Press reported Monday that benchmark U.S. crude fell 33 cents to settle at $65.55 per barrel on the New York Mercantile Exchange and that Brent crude, used to price international oils, shed 33 cents to close at $70.12 in London.
But it was about time for the old seesaw trick that oil and diesel perform. Oil goes one way as diesel goes the other way.
That happens because by the time oil has gone through the refining process to get to diesel and by the time diesel gets to distribution centers and the local truck stop, it takes a week or two or more to catch up to the price of oil and whether the price direction is up or down.
A few of the EIA’s reporting regions saw hefty price hikes in diesel Monday. For example, the West Coast Less California sector saw prices go up 8.7 cents a gallon to $3.147 from $3.060 the week prior.
The Rocky Mountain sector experienced a diesel price increase of 6.6 cents a gallon. Truckers there are paying $2.991 a gallon today compared with $2.925 last week.
And truckers in the West Coast region today are paying 5.4 cents more for a gallon for diesel — $3.438 — compared with $3.384 a gallon a week ago.
In EIA’s Lower Atlantic reporting region truckers are paying 4 cents a gallon more at $2.898 compared with $2.858 the week of March 19.
To see more diesel prices by region, click here.
After taking a slide Friday on fears surrounding President Donald Trump’s announcement that he was taking China to task for their copyright and other infringements against U.S. businesses, the stock market went back up Monday, though, and oil prices along with it. China said it is ready to deal.
In other energy futures trading, heating oil was little changed at $2.02 a gallon. Wholesale gasoline lost 2 cents to $2.01 a gallon. And finally, natural gas added 3 cents to $2.62 per 1,000 cubic feet.
So, if the price of crude continues to slide for days or even a few weeks, diesel prices will probably follow the leader and slide again, too.
If, however, Monday was just an oil hiccup and oil prices go back up, look for diesel prices to go back up again eventually.
But of course, so many things beyond our control make oil go up and down, it seems, from presidential announcements to political unrest in oil-rich countries to news on the U.S. interest rate.
So, stay tuned. Just like the weather, the prices of oil and diesel are always changing.