The U.S. Energy Information Administration (EIA) released its weekly data on diesel and gasoline retail prices for the week ended January 13, 2020. Prices declined for both fuels. Gasoline prices fell slightly by 0.8 cents/gallon, while diesel prices fell by 1.5 cents/gallon. The national average price for gasoline was $2.570/gallon, which was 32.3 cents/gallon above the price for the same week one year ago. Until November, gasoline prices had been below their levels from last year. Diesel prices now are above last year’s level also. On a national average basis, the retail price for diesel averaged $3.064/gallon, which was 8.8 cents/gallon higher than the price in the same week last year.
Futures Prices and Retail Price Outlook
During the week January 6, 2020 to January 10, 2020, West Texas Intermediate (WTI) crude oil futures prices fell sharply by $4.10/barrel (6.4%.) Gasoline futures prices dropped by 9.77 cents/gallon (5.6%.) Diesel futures prices dropped by 12.33 cents/gallon (5.9%.) Fuel prices had surged initially when the U.S. launched a drone strike on Baghdad International Airport, assassinating Iranian General Qassem Soleimani. WTI crude prices hit a peak price of $64.72 on Monday, January 6, and gasoline and diesel prices surged alongside crude. The Iranian response, however, was moderate, taking no U.S. casualties. This allowed a de-escalation of hostilities. Markets calmed with extraordinary rapidity. While the relationship between futures prices and retail prices is not immediate or one-for-one, gasoline and diesel retail prices are likely to decline in the coming week.
Retail Diesel Prices
For the current week ended January 13, retail diesel prices fell by 1.5 cents to settle at an average price of $3.064/gallon. Retail diesel prices had been below the $3/gallon mark until the attacks on Saudi Arabian oil facilities in mid-September, but they have remained steadily above the $3/gallon mark since then. Leading up to this event, between mid-October 2018 and late-January 2019, retail diesel prices fell for fourteen consecutive weeks. During those fourteen weeks, the price decline totaled 42.9 cents/gallon. From February through April, diesel prices crept back up by 20.4 cents/gallon. The month of May brought a modest reversal in the upward trend in diesel prices. During the five weeks of June including the week ended July 1, diesel prices fell more substantially, declining by 10.9 cents/gallon. For the current week ended January 13, diesel prices fell in all PADDs countrywide. The national average price for the week was 8.8 cents/gallon above where it was during the same week last year.
In the East Coast PADD 1, diesel prices fell by 0.9 cents to arrive at an average price of $3.111/gallon. Within PADD 1, New England prices increased by 0.4 cents to average $3.131/gallon. Central Atlantic diesel prices eased slightly by 0.3 cents to average $3.291/gallon. Lower Atlantic prices fell by 1.6 cents to hit an average price of $2.984/gallon. PADD 1 prices were 6.2 cents/gallon above their levels for the same week last year.
In the Midwest PADD 2 market, retail diesel prices declined by 1.2 cents to average $2.965/gallon. Prices were 14.2 cents/gallon above their level for the same week last year. PADD 2 joined PADD 3 during the week ended June 17 in having diesel prices fall below $3/gallon. These two PADDs remain the only ones with prices below the $3/gallon mark.
In the Gulf Coast PADD 3, retail diesel prices fell by 1.8 cents to arrive at an average of $2.810/gallon. PADD 3 continues to have the lowest diesel prices among the PADDs, currently 25.4 cents below the U.S. average. Prices were 2.2 cents higher than for the same week in the previous year.
In the Rocky Mountains PADD 4 market, retail diesel prices dropped by 3.5 cents to settle at an average of $3.065/gallon. This was the largest price drop among the PADDs. PADD 4 prices were 7.8 cents higher than for the same week in the prior year.
In the West Coast PADD 5 market, retail diesel prices dropped by 2.3 cents to average $3.593/gallon. PADD 5 prices were 12.2 cents above their level from last year. Until the past month, PADD 5 had been the only district where diesel prices were higher than they were in the same week last year. This is now true in all PADDs. Prices excluding California fell by 2.3 cents to arrive at an average of $3.241/gallon. This price was 11.1 cents above the retail price for the same week last year. California diesel prices also fell by 2.3 cents to arrive at an average price of $3.872/gallon. Until the week ended June 24th, California had been the only major market where diesel prices were above $4/gallon, where they had been for nine weeks. California prices retreated below $4/gallon from July through October, rose above $4/gallon again during the first three weeks of November, and eased since then. California diesel prices were 13.0 cents higher than they were at the same week last year.
Retail Gasoline Prices
U.S. retail gasoline prices fell by 0.8 cents to average $2.570/gallon during the week ended January 13. Prices rose in PADD 2 and eased in all other PADDs. Retail prices for the current week were 32.3 cents per gallon higher than they were one year ago. Until November, gasoline prices had been below their levels of last year. Prices in all PADDs are now higher than they were one year ago.
Gasoline prices hit a peak of $2.903/gallon during the week ended October 8, 2018. Prices then slid downward for fourteen weeks in a row, shedding a total of 66.6 cents per gallon. In the next seventeen weeks, prices marched back up by 66.0 cents/gallon. Prices came very close to the peak they hit in early October. However, the months of May and the June brought an easing of prices amounting to 23.3 cents per gallon. The week ended July 1st reversed that downward trend and sent prices up once again.
For the current week ended January 13, East Coast PADD 1 gasoline retail prices fell by 2.0 cents to settle at an average of $2.519/gallon. The average price was 30.2 cents/gallon above where it was during the same week last year. Within PADD 1, New England prices decreased by 1.1 cents to average $2.560/gallon. Central Atlantic market prices rose by 0.2 cents, arriving at an average of $2.666/gallon. Prices in the Lower Atlantic market dropped by 3.8 cents to average $2.415/gallon.
In the Midwest PADD 2 market, retail gasoline prices rose by 0.7 cents to average $2.441/gallon. This was the only price increase among the PADDs. PADD 2 prices for the current week were 39.4 cents/gallon higher than they were for the same week last year.
In the Gulf Coast PADD 3 market, gasoline prices eased slightly by 0.2 cents to average $2.275/gallon. PADD 3 continues to have the lowest average prices among the PADDs, currently 29.5 cents/gallon below the average U.S. price. Prices for the week were 36.5 cents higher than for the same week last year.
In the Rocky Mountains PADD 4 market, gasoline pump prices fell by 3.4 cents to settle at an average price of $2.608/gallon. This was the largest price decline among the PADDs. This week’s PADD 4 prices were 30.2 cents higher than at the same time last year.
In the West Coast PADD 5 market, retail gasoline prices fell by 0.9 cents to settle at $3.199/gallon. This was 21.9 cents higher than last year’s price. Prices excluding California also fell by 0.9 cents to average $2.933/gallon, which was 17.7 cents/gallon above last year’s price. California prices declined by 0.9 cents to average $3.419/gallon. California prices rose dramatically in late September and early October, hitting levels above $4/gallon, and recently prices have been retreating. California prices were 25.8 cents per gallon above their levels from the same week last year. Until November, PADD 5 had been the only PADD where prices were higher than they were one year ago. Currently, average retail gasoline prices in all PADDs are higher than they were last year. The same holds true for diesel.