Diesel prices hit highest level in more than four years, says EIA
October 18, 2012
Diesel prices hit their highest level in more than four years this week, according to the Department of Energy’s Energy Information Administration (EIA).
The average price per gallon of diesel increased 5.6 cents to $4.15 per gallon. This is the highest price since the week of August 18, 2008, when prices were $4.207 per gallon. And it marks the second straight weeks prices have gone up—following last week’s 1.5 cent gain—which was preceded by two weeks of declines.
Prior to that diesel prices were up for 11 consecutive weeks through the week of September 17, during which time prices rose a cumulative 48.7 cents. On an annual basis, prices are up 34.9 cents.
In its recently updated short-term energy outlook, the EIA is calling for diesel prices to average $3.96 per gallon in 2012 and $3.73 in 2013, with WTI crude oil expected to hit $95.66 per barrel in 2012 and $92.63 in 2013.
Regardless of the fluctuation in diesel prices, shippers are cognizant of the impact diesel prices can have on their bottom line—for better or worse. And they continue to be proactive on that front, too, by taking steps to reduce mileage and transit lengths when possible as well as cut down on empty miles.
And even through shippers want to adjust budgets in order to offset the increased costs higher fuel prices bring, it is not always an easy thing to manage.
With fuel prices, for the most part seeing steady gains, the focus from a supply chain management perspective, according to shippers, is more on utilization and efficiency by doing things like driving empty miles out of transportation networks.
Oil barrel prices on the New York Mercantile Exchange were are $91.97 at press time. The Associated Press reported that the gain was spurred in part by September retail sales improving by 1.1 percent.
Subscribe to Supply Chain Management Review magazine
cutting supply chain costs and case studies in supply chain best practices. Start Your Subscription Today!