EIA: diesel benchmark rises $0.097 to $6.276, ending three weeks of declines

The benchmark diesel price used as the basis for most fuel surcharges rose $0.097 a gallon this week to $6.276, ending three straight weeks of declines, according to FreightWaves on Oct. 20, reporting the Department of Energy/Energy Information Administration weekly release.

The price is effective Monday, Oct. 19, and was released Tuesday. It remains about $0.25 below the all-time high of $6.529 set in late September, and it is $2.656 higher than the same week a year ago, according to the EIA table. Every region rose this week. The largest increase was on the West Coast less California, up $0.156 to $6.659, followed by the West Coast at $7.394, up $0.154, and California at $8.242, up $0.151. The Rocky Mountain region rose $0.120 to $6.422, the Midwest rose $0.093 to $6.352, the East Coast rose $0.076 to $5.984, the Lower Atlantic rose $0.095 to $5.740, and the Gulf Coast remained the lowest region at $5.903, up $0.094.

Futures had signaled the turn. Ultra low sulfur diesel on the CME commodity exchange jumped more than $0.21 a gallon on Tuesday, Oct. 13, as the market concluded that short-term steps like the Trump administration's diesel deal with Russia would have limited to no impact on supply, FreightWaves reported. The Oct. 13 settle was $4.9344 a gallon, and by mid-morning Tuesday the contract was at $4.9457, in what FreightWaves described as a lull after months of volatility. Oil prices then moved sharply lower on Tuesday on unconfirmed reports that Qatar and Pakistan had proposed restarting talks aimed at ending the Iran war; the reports had circulated Monday.

The crack spread between Brent crude and ULSD has mostly held in a range of $0.83 to $0.88 a gallon for about a month, with the occasional move above $0.90 — a sign, FreightWaves said, that diesel remains stronger than its historic differential to crude but that the spread has stopped blowing out. One development FreightWaves said should not affect prices: Phillips 66 locked out Teamsters members at its Bayway refinery in New Jersey on Monday afternoon after their contract expired; operations at the refinery are continuing normally.