Harvey leads to highest one-week diesel price increase in more than six years

By Tyson Fisher, Land Line staff writer | 9/5/2017

The average price of a gallon of on-highway diesel rose 15.3 cents to $2.758 per gallon for the week ending Monday, Sept. 4. This marks the second consecutive increase after a short-lived decrease two weeks ago and the highest prices since July 20, 2015, when diesel cost $2.782. This is also the largest one-week increase since March 7, 2011, when prices went up 15.5 cents.

Diesel price averages went up in all 10 regions in the U.S., according to the Energy Information Administration. The largest average increase was in the Lower Atlantic region, where prices at the pump went up by 19.7 cents per gallon. Prices went up 8.1 cents in the Rocky Mountain region, the smallest increase in the nation.

Following are the average prices by region as reported by the EIA:

  • U.S. – $2.758, up 15.3 cents
  • East Coast – $2.785, up 16.2 cents
  • New England – $2.723, up 10.5 cents
  • Central Atlantic – $2.886, up 12.8 cents
  • Lower Atlantic – $2.725, up 19.7 cents
  • Midwest – $2.707, up 14.1 cents
  • Gulf Coast – $2.615, up 18.7 cents
  • Rocky Mountain – $2.798, up 8.1 cents
  • West Coast – $3.044, up 13.4 cents
  • West Coast less California – $2.931, up 12.5 cents
  • California – $3.135, up 14 cents

According to ProMiles, the average retail price at truck stops was $2.702 on Monday morning, a 13.3-cent increase from last week.

ProMiles, the software company that maintains the websites ProMiles.com and TruckMiles.com, continues to offer its own weekly fuel price information. The company’s fuel price data are presented in the same format used by the EIA in the agency’s weekly reports. The prices include a national average as well as regional averages, and comparisons to the previous week and the previous year.

A key difference between the EIA and ProMiles reporting is the type and number of fueling stations the company surveys in order to calculate its averages. While EIA surveys 400 truck stops and convenience stores nationwide, ProMiles uses its direct feed from thousands of truck stops to develop its averages.

TruckMiles.com listed the daily average price for Tuesday at $2.789, with truckers in Pennsylvania paying an average of $3.254 pergallon, the highest in the nation. Truckers in Oklahoma are paying a national low of $2.501 per gallon, according to the site. No states in the Lower 48 states have been listed in excess of $4 per gallon at the pump since Dec. 4, 2014. Five states are reporting average prices above $3 for the first time since July 2015. No states have reported average diesel prices below $2 since April 27, 2016.

AAA has indexed diesel prices at $2.67 for Tuesday, 30.4 cents more expensive than this time last year and 16.4 cents higher than a month ago.

Fuel prices have increased at a rapid rate in the wake of Hurricane Harvey. On Thursday, Aug. 31, 15 refineries had been completely or partially shut down. Additionally, a pipeline from Houston to the East Coast was also shut down.

On Friday, Sept. 1, ProMiles was reporting a national increase of 4.41 cents from Monday, Aug. 28. However, increases in metro areas during the same time frame were much more significant. In Dallas, diesel increased by 24.1 cents, 15.7 cents in Charlotte, N.C. and 13.8 cents in Kansas City.

Courtesy of ProMiles

Data from ProMiles reveals diesel price increases in metro areas from Aug. 28 to Sept. 4.

By Saturday, Sept. 2, the weekly increase continued to grow. The national average increased by 8 cents and the Dallas area saw diesel go up by more than 30 cents. Charlotte and Kansas City continued to get proportional increases at 20 cents and 17.4 cents, respectively.

According to the Department of Energy, eight Gulf Coast refineries are going back online, accounting for nearly 10 percent of U.S. refining capacity. At one point, more than a quarter of the nation’s refining capacity was affected. The Colonial Pipeline is expected a restart for gasoline on Tuesday, Sept. 5.

As the nation recovers from Harvey’s damage, another massive hurricane is brewing near the southern tip of Florida. Currently, Hurricane Irma is a Category 5 storm located nearly 1,500 miles southeast of Key Largo. Although far away, southern Florida is within the 5-day cone of uncertainty. With sustained winds of 185 mph, Irma is the second-strongest hurricane recorded in the Atlantic. Hurricane Allen had sustained winds of 190 mph in 1980.

Although damage to the nation’s energy infrastructure would be minimal if Irma hits Florida, fuel prices could potentially increase further as demand is likely to increase in response to evacuations and possible relief efforts.

In separate energy news, according to the New York Mercantile Exchange, light sweet crude (also known as West Texas Intermediate) for October delivery was trading at $48.67 at noon CDT on Tuesday, a $2.10 increase from last Monday and a $1.38 increase from its last settlement price. The price of Brent crude oil for November settlement was listed at $53.42, a $1.53 increase from last Monday and a 67-cent increase from its last settlement price.

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