Average price of diesel hits record in US – $5.70 per gallon

From Freight Waves.

The weekly Department of Energy/Energy Information Administration average retail diesel price has a new record.

With a gain posted Monday of 16.4 cents, the new price of $5.703 a gallon easily surpassed the previous record of $5.623 a gallon set on May 9. It’s the first increase after three weeks of relatively small declines that took the benchmark price used for most fuel surcharges down just 7.5 cents a gallon.

The 16.4-cent increase isn’t even in the top three largest increases this year. If this were 2021, it would have easily been the biggest one-week gain for that year. But this year alone, the DOE/EIA price has gone up 74.5 cents, 40.1 cents and 34.9 cents.

Ultra low sulfur diesel (ULSD) prices climbed on the CME commodity exchange last week. While retail prices and futures prices do not move in tandem, the increase of almost 28 cents between the settlement of May 27 and last Thursday set the stage for the increase in the DOE/EIA price.

ULSD on CME is up 62.1 cents since a settlement of $3.7391 on May 20. Since that day, ULSD has risen 10 consecutive days, and since the year began, the price is up approximately $2.09 a gallon.

And diesel has once again taken the role of the biggest gainer in the petroleum market. On May 20, a barrel of diesel was worth between $44 and $45 more than a barrel of Brent, which is an enormous spread compared to historical relationships. On Monday, that spread was more than $61 a barrel.

That huge gap on Monday — which was surpassed only by big gaps at the end of April when the ULSD contract was being squeezed in the final days of the May contract — came as ULSD rose almost 8 cents to settle at $4.3601 a gallon, a jump of 1.86%. In contrast, domestic crude benchmark West Texas Intermediate dropped slightly, international crude benchmark was up 1.3% and RBOB gasoline, an unfinished gasoline product, fell 1.39%.

See the complete article online at Freight Waves.