For the seventh consecutive week, the Department of Energy/Energy Information Administration average retail diesel price has risen.
The latest move added 1.4 cents a gallon to the benchmark number, putting it at $3.727 a gallon. It is the second-smallest increase in the seven-week run of higher prices, with the streak having kicked off Sept. 20 with a 1.3-cent increase.
The price has now risen nine of the past 10 weeks.
However, there are signs of short-term weakening in the commodity price of diesel. The ultra low sulfur diesel price on the CME commodity exchange settled Monday at $2.5031 per gallon. That’s the lowest front-month contract settlement for ULSD since an Oct. 8 settlement of $2.4737.
There are also signs that diesel is no longer leading the pack among other petroleum contracts. Diesel prices had been rising at percentage gains more than those of the two global crude benchmarks, West Texas Intermediate and Brent.
But a comparison of ULSD and Brent prices Monday, converted to gallons, showed a spread of 48.62 cents a gallon Monday, the first time that spread had been below 50 cents since Oct. 1.
Another piece of good news for diesel consumers is that the spread between front-month ULSD and diesel to be delivered in 12 months narrowed to its lowest level since Oct. 21. That spread is driven primarily by inventories, with tight inventories leading to the front month growing in value relative to the 12th month. It recently was as wide as 21.77 cents but settled Monday at 18.78 cents a gallon, a possible sign that inventory tightness might be easing.
The OPEC+ group, which includes OPEC members as well as a large group of non-OPEC members led by Russia, is meeting Thursday to decide what to do with production in December. The group has been adding roughly 400,000 barrels a day of production each month since the spring. Despite calls by the Biden administration to put more oil on the market, statements coming out of several OPEC members in recent days suggested that production increases beyond the 400,000 barrels per day were not likely.
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