The average national price of diesel fuel has dropped to its lowest levels since February 2011, with truckers paying a little more than $3.63 a gallon to fill up their rigs, the Department of Energy's Energy Information Administration (EIA) said late yesterday.
As a national average, the price of a gallon of diesel has fallen more than 23 cents a gallon from the same period a year ago, according to EIA data. Given that fuel is either a trucker's largest or second-largest cost item (it vies with labor for the top spot), the decline, if it is sustained, will deliver a significant expense tailwind to the entire supply chain.
The decline in diesel prices mirrors a significant drop in the price of crude oil. A barrel of West Texas Intermediate (WTI) crude, the benchmark for U.S. oil production and consumption, fell to $81 a barrel as of yesterday, EIA said. That's down nearly $17 a barrel from the same period in 2013.
Oil prices fell sharply yesterday after investment firm Goldman, Sachs & Co. dramatically cut its 2015 forecasts for WTI and world Brené oil prices. Goldman forecast that WTI prices will average about $75 a barrel next year and may touch $70 a barrel sometime this spring. The firm predicted that Brené oil prices would average about $85 a barrel in 2015.
Goldman had previously forecast an average price of $85 for WTI crude next year and $100 for Brené crude.