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Fuel Prices Up, Crude Oil Production Unlikely to Drop

April 18, 2016

Source: EIA
Source: EIA

The price of diesel fuel rose last week for the second straight week, but uncertainty in the crude oil market could curb the increases, according to the latest numbers from the Energy Department.

The average price of on-highway diesel fuel jumped by 3.7 cents, increasing to $2.165 per gallon. The price of a gallon is still more than 61 cents cheaper than it was 12 months ago.

Prices vary around the country and the largest regional increase was in Gulf Coast. The average price of a gallon of diesel increased by 5.4 cents. The smallest increase by region was in the Central Atlantic at 2.4 cents.

The price of regular gasoline fuel increased once again last week, jumping 6.8 cents to a price of $2.137 per gallon. The price is still nearly 35 cents cheaper than it was for the same week a year ago.

Price were up significantly in most areas of the U.S., with the Midwest seeing a 9.2 cent increase in prices. The smallest increase in prices was a 2.8-cent jump on the West Coast.

Crude oil prices saw a decline on April 18, as a meeting of oil producing countries over the weekend, failed to produce an agreement to freeze oil production, according to a MarketWatch report.

OPEC members met in Doha, Qatar to discuss crude oil production, which has been much higher than global demand for the past year. That has caused prices to drop dramatically. Market analysts were hoping that the countries would agree to freeze production at current levels to help stabilize the crude oil market, but no agreement was reached.

Without an agreement, prices were expected to drop dramatically again. But a worker strike in Kuwait that reduced that country’s oil production by 50% managed to offset a huge decline.

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