The weekly Department of Energy/Energy Information Administration average retail diesel price is in the midst of another significant run of increases, looking relatively small only because of the monster run of hikes that concluded in March.
The price posted this week of $3.30 a gallon was up 1.3 cents from the prior week. It also marked the ninth consecutive week that the benchmark price used for fuel surcharges rose.
That does not seem like much compared to the 20-week record-breaking run that began last November and finished in March. But the current nine-week increase is the second longest since a 10-week string of increases from February to June 2016.
It comes as June is wrapping up. Since a settlement on the ultra low sulfur diesel commodity contract on CME of $2.0715 a gallon on June 1, the ULSD price rose 2.2% through the Monday settlement of $2.1182 a gallon. However, that is a significantly smaller increase than the 6.6% increase in the price of Brent crude posted through Monday for June.
ULSD took a particularly large downward hit Monday on the back of several pieces of news. The decline to $2.1182 marked a 3.11% decline for the day, or 1.45 cents, a far bigger drop than posted in other petroleum contracts.
One of the market’s bearish factors is the spread of the Delta variant of COVID-19, which is raising fears of renewed travel restrictions. That would impact the market for jet fuel, which like diesel is a distillate. Jet fuel weakness therefore extends into the price of diesel.
Secondly, the OPEC+ group is meeting this week, pulling together the members of OPEC and key non-OPEC exporters to decide what steps to take regarding production levels. A report by RBC Capital Markets, considered one of the leading oil market analysts, said the group at its Thursday meeting might add as much as 1 million barrels a day of crude to the global market, a number that would be larger than what had been anticipated.
The increase in the DOE price comes after a significant upward movement in the wholesale price of diesel, according to data in the ULSDR.USA data series in SONAR. That series reported that since June 18, the average national price of wholesale diesel has risen more than 8 cents per gallon. That far outstripped the price of ULSD on CME during that period. The two prices trend together but do not match each other in a perfect correlation.
More articles by John Kingston
Two more enter guilty pleas in Louisiana staged accident scheme
Did trucking jobs rise in May? It depends
BMO’s transportation sector write-offs fall to lowest level in 5 years
Packers and movers in peenya Packers and movers in peenya Packers and movers near me Packers and movers near me Packers And Movers Banashankari Bangalore a Packers And Movers Banashankari Bangalore a Packers And Movers Jayanagar Packers And Movers Jayanagar Packers and movers Yelahanka Packers and movers Yelahanka Packers And Movers Btm Layout Packers And Movers Btm Layout Packers And Movers Koramangala Packers And Movers Koramangala Packers And Movers Hsr Layout Packers And Movers Hsr Layout Packers And Movers Bommanahalli Packers And Movers Bommanahalli Packers And Movers Begur Road Packers And Movers Begur Road Local Packers And Movers Bangalore Local Packers And Movers Bangalore Packers And Movers Ramamurthy Nagar Packers And Movers Ramamurthy Nagar Packers and movers Bangalore Packers and movers Bangalore