More Relief at the Pump

Three-dollars-a-gallon diesel. It’s a phrase that many truckers thought they may never utter again.

That had been the case since Sept. 27, 2010, the last time the U.S. Department of Energy reported that the diesel average was below $3. The very next week, it reached exactly $3 a gallon. And diesel has stayed above that level every week since then.

Now, to be fair, last week’s price was $3.535, a figure that low only after a 7-cent drop from the previous week’s report.

However, that price is down a whopping 40 cents from June, and almost 50 cents since reaching its high of the year of $4.021 in March. That is also 34.4 cents less than a year earlier and the lowest since February 2011.

As nice as the relief at the pump is for diesel consumers, it pales in comparison to the retail gasoline average, which DOE said last week sat at $2.679.

Gasoline was down almost a dime just from the previous week and is at its lowest level in nearly five years. And in a few sporadic areas of the United States, prices are already below $2.

None of this should be all that much of a shock to readers of Transport Topics, since we have been reporting on these downturns all along. They have mirrored the decline in crude oil prices, which fell below $60 a barrel on the New York Mercantile Exchange late last week.

However, it was last week’s Short-Term Energy Outlook from DOE’s Energy Information Administration that caught us a little bit off guard.

The latest downward revisions have the diesel average pegged at $2.97 during April and May. And, for the entire year, the new projected average is $3.07.

That is not only about 45 cents below where the average currently sits — it is exactly 90 cents below the 12-month average from 2012. “We’re seeing a lot suggesting that diesel prices are going to be a lot lower . . .,” EIA’s Sean Hill said. “Oil prices have fallen even more than we thought they would.”

He added: “Lower prices are finally catching up with high oil production and supplies.”

Of course, when getting only 6 or 7 miles to the gallon in a truck, $3 can add up quickly.

But as fleets wind down what has turned out to be a mostly positive 2014, we hope EIA’s report of more relief at the pump is the first indication that 2015 may have more pleasant surprises in store.