Diesel prices keep dropping. It has been the case for quite some while now. The price dropped by 15.8 cents. It is now at $4.596 per gallon. The trend has been downwards for the past six weeks. The price drop for the six weeks amounts to 73.7 cents. The last time the price averaged below $4.60 was Feb 28. At the time, the price was $4.104 per gallon. However, the price is still 97 cents more than where it was a year ago. Gasoline prices also went 11.9 cents lower. It now goes for $3.120, 17.5 cents cheaper than last year.
The Current Status
According to Transport Topics, Ed Moya said that people are already ready for the holiday season. He added that there were a few exciting moves on the market. EIA says that crude oil would go for $78.29 per barrel. The figure is $1.01 higher than a week ago. It is also $7.17 higher than a year ago. China is the biggest hope for the oil market. Hopefully, as things continue opening up, there will be more demand for crude oil. EIA noted that refineries were just over 90% of their capacity as of Dec 16. Gasoline production went up during that period.
Diesel Demand
US diesel demand has been falling for years now. This is no surprise. It is just part of the slow economic growth, and things are returning to normal. There is enough capacity at hand to handle the demand. Things need to be up to the speed of time. There are many reasons why the market has had issues. First was the disruption due to the Ukraine-Russia war. Another was due to Covid restrictions in China. Uncertainties around the economy also didn't help.
The use of renewable diesel is on the rise at the moment. The trend will be the same heading into 2023. The market for the same will triple in the next five years. At the same time, Jennifer Granholm seeks peace with the oil and gas industry. Despite the issues, she acknowledged that fossil fuel is very important. As people move towards renewable energy, fossil fuels can't be tossed away. Therefore, its production will continue to increase and be around for a while.
