LITTLE ROCK, Ark. — Diesel prices continue to trickle down as U.S. stocks of road diesel show signs of stabilization and even increasing slightly.
This news is welcomed as concern built before the Thanksgiving holiday that U.S. diesel stocks were dwindling toward a possible shortage.
John Kemp, a senior market analyst specializing in oil and energy systems, said that although the increase is small, “it runs against the normal trend for a drawdown at this time of year and indicates high prices and a slowing economy are starting to rebuild inventories.”
Meanwhile, distillate fuel oil inventories increased by 3 million barrels in the six weeks between Oct. 7 and Nov. 18, according to Energy Information Administration (EIA).
“In the 10 years before the pandemic, distillate inventories declined by an average of more than 11 million barrels over the same period,” according to Kemp. “Between 2010 and 2019, seasonal drawdowns ranged from ranged from as little as 7 million barrels to as much as 21 million barrels.”
Distillate inventories have not increased at this time of year since 2008, when the financial crisis was pushing the economy further into recession, Kemp noted.
Stocks are still 21 million barrels (-16% or -1.25 standard deviations) below the pre-pandemic five-year seasonal average.
But the deficit to the seasonal average has narrowed from 34 million barrels (-24% or -2.05 standard deviations) on Oct. 7, Kemp said.
As for diesel prices, the latest numbers from the EIA show that the national average sits at $5.141 per gallon, down from $5.233 per gallon on Nov. 21, $5.313 per gallon on Nov. 14 and $5.333 on Nov. 7.
However, the average national diesel price per gallon is still up more than $1.50 over this time last year.
The Trucker News Staff produces engaging content for not only TheTrucker.com, but also The Trucker Newspaper, which has been serving the trucking industry for more than 30 years. With a focus on drivers, the Trucker News Staff aims to provide relevant, objective content pertaining to the trucking segment of the transportation industry. The Trucker News Staff is based in Little Rock, Arkansas.