After approaching nearly $5/gal. during a meteoric rise in 2008, diesel fuel prices dropped along with the economy in 2009. But since falling to nearly $2/gal. in early 2009, prices have steadily climbed, a trend that should continue through 2011, according to Neil Gamson of the U.S. Energy Information Administration (EIA).
Gamson told Fleet Owner that EIA is predicting diesel prices will average $2.96/gal. this year and climb to $3.11/gal. in 2011. In 2009, on-highway diesel fuel retail prices averaged $2.46/gal.
The U.S. and world economies have a significant impact on prices, according to Gamson. “If the economy gets worse than expected, then crude oil prices would go down more than expected.”
While there is plenty of economic unrest in Europe these days, Gamson said to keep a closer eye on fuel consumption in Asia, particularly China. EIA forecasts world oil consumption growth of about 1.5 million barrels a day in 2010 and 1.6 million in 2011, with much of that consumption coming in the Asia-Pacific and Middle East regions. However, that growth can change based on the political winds and the opinion of OPEC.
“OPEC has been fairly disciplined,” Gamson says. “They seem comfortable in the $70-$80 range (for crude oil). The major player in the field is Saudi Arabia; if they see prices dropping, they could cut output” and that could drive up prices.
A barrel of crude oil was trading at $76.83 this morning ahead of an Energy Dept. report that was expected to indicate U.S. oil supplies declined for the quarter.
For the U.S. trucking industry, though, if the predictions play out as expected, the sudden pain of rising diesel prices that hampered much of the industry in 2008 won’t be returning anytime soon.
Photo courtesy of good-god-guy and re-used under the Creative Commons license.