Diesel prices continue to fluctuate within a narrow band
Weekly retail on-highway U.S. diesel prices decreased by 0.5 cents to $2.539 per gallon on May 22, continuing a trend of very modest fluctuations up and down in every week this year. Diesel has ranged between 2.53 and 2.60 per gallon since 12/19, never rising by more than 4.6 cents or falling by more than 2.5 cents in any week during that period.
In February 2016, diesel prices reached their lowest level ($1.980) since January 2005, dropping below the recessionary trough, before rebounding throughout the rest of the year, finally crossing the $2.50/gallon mark on 12.19. The last year that diesel did not hit $2.50 per gallon all year was 2004. We have been above that level all year to this point.
Diesel prices are 18.2 cents per gallon higher than one year ago, but are 37.5 cents per gallon lower than two years ago. On May 9, the Energy Information Administration (EIA) decreased its pricing forecast to 2.65 per gallon for 2017, so still anticipates further increases this year.
A view of weekly prices over the last 6+ years (second chart) indicates fairly stable prices between Q2 2011 and the start of the 2015 slide (min of $3.65 and max of $4.16). Diesel prices then stabilized between August 24 and November 16 of 2015, with a high of $2.561 and a low of $2.476 during those 13 weeks, but were in steady decline between then and February 2016 before beginning a slow but steady climb.Diesel remains below the May price level in each of the five years prior to 2016.
The recessionary low price point for diesel was $2.023 in March 2009. Diesel prices peaked at $4.771 per gallon in July 2008.