It seems that last week’s plateau in diesel prices was correct in heralding the end of the fall in diesel prices, as for the first time in 2024, more regions saw increases in the cost of diesel than decreases. As of Jan. 16, the U.S. Energy Information Administration found the national average for U.S. on-highway diesel fuel prices to be $3.863 per gallon, three cents higher than a week ago.
While diesel fuel prices are all still lower than this time last year, the widespread increase could be due to greater demand generated by the cold front currently covering much of North America, potentially raising the demand for fuel. But the pump price upticks in most U.S. regions were not large, ranging from 2-6 cents across the board. The Gulf Coast’s 6-cent jump to $3.592 per gallon was the most this week, while the Central Atlantic sub-region saw no change, leaving its prices at $4.249 per gallon for the second straight week.
Only three regions saw a decrease in diesel prices: the New England subregion, which dropped two cents to $4.296; the Rocky Mountain region, which fell four cents to $3.755; and California, which dipped one cent to $5.142 per gallon. According to the government agency, the Gulf Coast is still the cheapest place to purchase fuel, while California is still the most expensive.
The AAA motor club logged this week’s average national diesel price at $3.917 per gallon, five cents more expensive than the EIA’s report but three cents lower than last week’s AAA average diesel price of $3.947. This also placed this week’s diesel prices well below the AAA’s report of diesel prices last year, which reached $4.597 per gallon.
Looking ahead into 2024 and 2025, the EIA’s Short-Term Energy Outlook, released on Jan. 9, anticipated that monthly retail diesel costs will largely hover around the annual diesel average. Due to component price changes, it also forecasted a drop of 29 cents per gallon for diesel prices in 2024.
See also: Diesel fuel price drop ebbs but still trickles down
Gasoline prices continue decline
Unlike the EIA’s diesel reports, gasoline prices continued to drop the week of Jan. 15. The administration reported a U.S. regular gasoline price of $3.058, about one cent cheaper than last week and 25 cents cheaper than last year. The price drops ranged from one cent to 12 cents (up to $4.339 per gallon) in California, with only the Midwest seeing a gasoline price increase of 5 cents to $2.823.
As gas prices have continued to fall, the Gulf Coast is still the cheapest place to buy fuel at $2.676 per gallon, while California is the most expensive at $4.339.
In comparison, AAA’s current average U.S. gas price is $3.068 per gallon, which is barely cheaper than last week’s price of $3.078. Even so, the cost is better than last year’s average at this time, which was $3.305 per gallon.
In a news release from the AAA, the organization noted that gas prices likely plateaued due to oil costs and gasoline demand. However, this could change if the cold weather continues.
“The mid-winter blahs will likely keep pump prices waffling a few cents up and down for the immediate future,” said Andrew Gross, AAA spokesperson. “But keep an eye on frigid temps because those can affect refinery production, pushing some regional pump prices higher.”
However, the EIA’s Short-Term Energy Outlook forecasts another decline in gas prices overall, with a U.S. average of about $3.40 per gallon in 2024 and $3.20 in 2025. This could be due to the administration’s anticipation that the U.S. will produce 13.2 billion barrels of crude oil daily in 2024 and more than 13.4 billion per day in 2025.
