Record diesel prices continue uptrend, surpass $6

By RHIANNON BRANCH

FarmWeek

The price of diesel fuel has yet to find a ceiling as the national average price surpassed the $6-per-gallon mark Sept. 15, according to the US Energy Information Administration (EIA).

While drilling capacity is adequate, refining and distributing systems remain off course due to conflicts in the Middle East.

“With the inventories being so low and demand continuing to go up, that means your price is going to continue to go up until we get some sort of resolution,” Don Schaefer, president of the Mid-West Truckers Association, told Jim Taylor with the RFD Radio Network.

EIA’s latest weekly price report showed US on-highway diesel averaged $6.28 per gallon, up 32 cents from the prior week and $2.54 from the same week a year ago. Midwest diesel averaged $6.25, up 30 cents on the week, according to EIA.

Crude oil prices are at a three-month high. The Brent crude oil spot price recently increased 7.9% to $130.80 per barrel.

Higher fuel prices are putting pressure on some farm budgets during harvest season, especially for those farmers and truckers who couldn’t lock in supplies prior to the spike.

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“The real challenge is for the small operator who goes and buys (diesel) at the station. They’re paying the pump price and it’s expensive,” Schaefer said.

With corn and soybean harvest underway across the Midwest, diesel consumption by the agriculture sector is in a peak season.

“You can’t postpone harvest and you’ve got to have the fuel to get into the combines, trucks and other equipment you have. So, you have to go with the flow and this is a tough year,” Schaefer said.

Another bottleneck occurred Sept. 13 when a power outage at the ExxonMobil refinery in Joliet triggered a safety flare, resulting in a four-hour shutdown.

The refinery is equipped to handle about 275,000 barrels of crude per day, producing about 11 million gallons of gasoline and diesel fuel daily.

While the shutdown in Joliet was temporary, any extended operational disruptions could intensify an already tight fuel market and push prices even higher.

This story was distributed through a cooperative project between Illinois Farm Bureau and the Illinois Press Association. For more food and farming news, visit FarmWe