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The Cost of Diesel Fuel – Will it Continue to Rise?

January 24, 2017 | Alex Elias

Have you been feeling the pain of higher fuel prices lately?

The price of highway diesel fuel has been on the rise since January 2016, according to the Department of Energy. While down slightly this past week, prices averaged 47.3 cents higher across the U.S. than last year at this time, and may continue to trend upward.

To give you an idea of what motor carriers are facing across the country, during this past week diesel prices were lowest in the Gulf Coast region at $2.429 per gallon and highest in California at $2.937 per gallon.

In the Midwest, diesel cost $2.541 per gallon, while prices averaged $2.511 per gallon in the Lower Atlantic and $2.804 per gallon in the Mid-Atlantic.

What to Expect This Year

Diesel prices have spiked due to a rise in demand both in the U.S. and abroad, along with a decrease in production. Whether fuel costs will rise again or trend downward this year remains uncertain. The Department of Energy projected that prices could rise as much as 15 percent over the course of 2017.

“The diesel price is forecast to average $2.73 per gallon in 2017 and $2.84 per gallon in 2018, driven higher primarily by higher crude oil prices and growing diesel consumption, which is expected to contribute to higher diesel refinery margins,” the Energy Department said in a press release.

What You Can Do

Even if fuel prices continue to rise, there are steps you can take to keep your expenses down. Here are a few tips to keep in mind:

  • Include a surcharge on shipments to account for the rising cost.
  • Make the most out of every tank of gas with route planning. Use software or enlist the help of a fleet management company to effectively map out routes that conserve the most fuel.
  • Keep up with truck maintenance. By making sure your tires are at optimal pressure and keeping your engine in tune, you can save gas every time you drive.
  • Monitor your driving habits. Aggressive driving, which includes speeding, accelerating and braking too quickly can eat up fuel and lower highway fuel economy by as much as 33 percent.

Fuel cards can also help you manage the rising cost of diesel. At Foley, our fuel card can save you up to 14 cents a gallon at the pump. You can learn more about our fuel card program here.

What do you think about the rising costs of diesel fuel? What are you planning to do to help offset the price increase? Let us know in the comments below!

About the author:

Alex Elias

Alex Elias is the Director of Factoring Sales and Account Management. In his role, Alex is responsible for the strategic growth of the department, as well as ensuring that every Foley customer receives fast payments and superior customer service. Alex is also an active member of the International Factoring Association and an authority on the current state of the factoring industry.

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