Diesel costs are following in the wake of sinking crude oil prices-- diesel falling last week to $4.353 per gallon, almost 15 cents less than the week before, according to the Department of Energy (DOE).
DOE points out that the weekly diesel price fell from $4.76 per gallon July 14 to the $4.35 August 11, a drop of 41 cents. In the past few weeks, crude oil has slumped almost $10 per barrel from approximately $134 to $125. However, this time last year, crude oil was trading for about $75 per barrel.
Despite the current relief, diesel prices are projected to remain above $4 per gallon, averaging $4.18 and $4.27 per gallon, respectively, in 2008 and 2009, compared with $2.88 in 2007, DOE said in its monthly short-term report.
Impacting the overall petroleum market are Americans turning off their engines in a greater movement than when they exhibited similar behavior in the oil-drought 1970s era. Since last November, they have been driving 53.2 billion miles less than they did over the same period a year earlier--topping the 1970s’ total decline of 49.3 billion miles, according to Department of Transportation (DOT) information
That data makes DOT nervous since it depends on fuel taxes for funding highway infrastructure. “We can’t afford to continue pinning our transportation network’s future to the gas tax,” Transportation Secretary Mary Peters said in a news release. “Advances in higher fuel-efficiency vehicles and alternative fuels are making the gas tax an even less sustainable support for funding roads, bridges and transit systems.”
Ron Planting, American Petroleum Institute (API) statistics manager, said in an API monthly report that demand for gasoline has fallen off significantly as a result of changes in consumer behavior, essentially erasing five years of growth. “With less demand, we’re importing less oil,” he said. “However, imports still represent the lion’s share of US consumption. Canada is the largest of our diverse suppliers, providing us nearly as much oil as the total from all of the Persian Gulf nations.”
Meanwhile last week, low sulfur diesel was $4.240 per gallon, 15.5 cents less than the week before. Ultra low sulfur rang up at the pump at 4.368 or 14.7 cents less than the week before.