Fuel Smarts

Another Hike in Diesel Prices, Oil Nears $50 Per Barrel

May 16, 2016

Source: EIA
Source: EIA

The average price of diesel fuel increased once again last week, continuing a streak of price hikes that began in February, according to the latest numbers from the Energy Department.

The price of a gallon of diesel fuel increased 2.6 cents for the week, hitting $2.297 at the pump. While the price has been steadily increasing this year, it is still more than 60 cents cheaper than it was in the same week a year ago.

The largest price increase was in the Rocky Mountain region with a 4.7-cent jump from the previous week. The smallest increase was in New England, where the price average moved less than a cent.

The average price of regular gasoline also increased last week, jumping 2.2 cents and settling at $2.242 per gallon. That price is 50.2 cents cheaper than it was a year ago.

Prices showed significant variation by region with the Midwest seeing a 6.2-cent increase for the week. In New England, the price actually decreased slightly by 0.7 cents per gallon.

Crude oil prices hit some of the highest levels of the year as the market reacted to reports that the oil supply glut has reduced significantly, according to MarketWatch.

A Goldman Sachs report claimed that the global oil surplus had actually turned into a deficit thanks to drops in production.

Unexpected outages in oil production and increases in demand contributed to the deficit, which is the first in more than two years. This had a large effect on the market with the price of a barrel of oil nearing $50 on May 16.

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