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The national average price of diesel fell by six-tenths of a cent to $2.435 a gallon, according to the Energy Information Administration, which released its weekly report Sept. 8, a day later than usual because of the Labor Day holiday.
The average price fell in nine of the 10 regions. The steepest drop was in the West Coast region, not including California, where the price of diesel declined 1.9 cents per gallon to $2.584. Diesel is 54.7 cents less per gallon in that region than it was a year ago.
The New England region saw a one-cent-per-gallon drop to $2.612, putting diesel 41 cents less expensive than in 2019.
What are fleets doing to help attract the best possible diesel technicians to join the changing workforce environment? Host Michael Freeze speaks with Ken Boyer, dean of the Auto/Diesel Institute at Baker College, and Ralph Romero, vice president of talent management at U.S. Xpress. Hear a snippet, above, and get the full program by going to RoadSigns.TTNews.com.
The most expensive diesel continues to be in California, where the price remained flat week-to-week, coming in at $3.276 a gallon for the second week in a row. The price of diesel in California is 60.2 cents less expensive than in 2019.
The least expensive diesel remains in the Gulf Coast region, where diesel fell four-tenths of a cent to $2.184 a gallon. Diesel is 56.1 cents less expensive than a year ago.
The Gulf Coast boasts the lowest price in part because it is home to much of the country’s oil and gasoline production and a large share of the refining capacity.
Hurricane Laura came ashore near Lake Charles, La., as a Category 4 storm Aug. 27, making it the most powerful storm to hit that state in decades. However, oil industry analysts, including Phil Flynn in Chicago, say it appears the storm did not do as much damage to the refineries as first feared.
With the Labor Day holiday over, and the traditional summer driving season coming to an end, the price of a barrel of West Texas Intermediate oil dropped 7.3% in trading on the New York Mercantile Exchange, closing on Sept. 8 at $36.84 a barrel. Throughout the months of July and August, oil had been trading in a narrow range between $40 and $43 a barrel. According to Macrotrends.net, WTI has declined by 34.8% in the last year. One year ago, WTI was trading at $56.52 a barrel.
Economist Aaron Terrazas, the director of economic research at Convoy Inc., told Transport Topics oil companies need to make approximately $40 a barrel to turn a profit, and if the price continues to slip, they’ll be forced to make tough decisions about whether or not to keep wells operating.
“The break-even point for a lot of shale production is about $40 a barrel,” Terrazas said. “At that level, and if you look at the trends they’ve kind of stabilized at that point. What international oil prices were at the level they were barely profitable, and not so low they were shutting down wells. They’re just keeping production humming along, so they don’t have to keep shutting down wells.”
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