Fuel prices in the U.S. continued their dramatic decline this week due to an ongoing though slowing slump in global oil prices combined with predictions for a mild winter that is expected to drive down demand for heating oil, according to data tracked by the Energy Information Administration (EIA).
EIA noted that while the National Weather Service (NWS) reported that this November was 18% colder than the 10-year average for the entire U.S., the agency still expects this winter to be on balance milder than the 2013-2014 season, with temperatures ranging from 11% to 16% warmer for the Northeast, Midwest, and South.
For that reason, EIA expects total heating oil consumption – made from the same petroleum distillate as diesel fuel – is not expected to increase and indeed fall 8% in the Northeast compared to last year, according to the agency’s most recent Short Term Energy Outlook update.
EIA added that consumption of heating oil for space heating is concentrated in the Northeast, where about 24% of households depend on the fuel, compared to only 5% of households nationwide.
On top of that, the agency noted that monthly average Brent crude oil prices are down 29% from a high of $112 per barrel (bbl) in June to an average of $79/bbl this November.
EIA expects Brent prices to average $78/bbl in the fourth quarter this year, compared to $109/bbl for the same time last year.
All of that combined continues to help pushing down national and regional retail pump prices for diesel and gasoline.
Diesel dropped 6.8 cents this week to a national retail pump price of $3.213 per gallon, which is 69 cents per gallon cheaper compared to the same week in 2013, EIA reported.
The Rocky Mountains posted the biggest decline in diesel prices for the week – a 9.9 cent dip to $3.239 per gallon – followed by the Midwest with an 8.8 cent drop to $3.206 and the West Coast (with California excluded) with a 7.3 cent decline to $3.151, the agency said.
With California included, however, West Coast diesel prices decreased 6.2 cents to $3.269, EIA pointed out, noting that the Gulf Coast remains home to the cheapest diesel with a 5.4 cent dip pegging the region’s weekly retail pump price at $3.121 per gallon.
National retail pump prices for gasoline declined 10.4 cents this week $2.299 per gallon, the agency reported, which is $1.032 per gallon cheaper compared to the same week in 2013.
The Rocky Mountains sported the biggest dip in regional gasoline prices this week; a 15.6 cent drop to $2.228 per gallon. The Midwest came in second with a 13.6 cent decrease to $2.088, while the Gulf Coast nabbed third place with a 10.3 cent decline to $2.073; which is also the cheapest regional retail pump price for gasoline in the country this week.