GasBuddy: Diesel prices fall below year-ago level

(ABC 6 News) – It’s been a rough two years for drivers who use diesel in their vehicles. Record prices in 2022 meant diesel drivers were paying an average of $5.82 a gallon at one point in 2022, according to GasBuddy.

Average diesel prices in the U.S. Friday will fall below their year-ago levels. GasBuddy says diesel prices have declined nearly $1.50 per gallon since reaching record-levels last spring and now stand at an average of $4.35 per gallon, the lowest level since the days immediately after the Russian invasion of Ukraine.

“Diesel’s decline has been astounding-we’ve seen improvements in fundamentals over the last few months with diesel prices down nearly $1 per gallon in the last 100 days, thanks in part due to the Fed raising interest rates, throttling back the economy, as well as Mother Nature reducing consumption through a mild winter and curbing consumption of diesel’s cousin, heating oil,” said Patrick De Haan, head of petroleum analysis at GasBuddy.

Iowa and Wisconsin are two of seven states where the average price of diesel fuel has fallen below $4 per gallon. The average price for diesel in Minnesota is $4.08 per gallon as of Monday, Feb. 27.

According to GasBuddy, retail diesel prices are likely to continue falling as demand continues to ease and winter heating oil consumption declines.

“Coming out of winter, we’ll continue to see diesel prices decline,” says De Haan. “Barring an unexpected disruption or escalation in global events, diesel prices this summer could be $2 per gallon lower than last summer, which is certainly good news for the economy and transportation sectors stung by the previous high costs of diesel fuel.”

GasBuddy says as long as central banks continue to raise interest rates to cool off previously overheated economies, there will be continued downward pressure through most of the spring and summer, even as gasoline prices are likely to rise during that timeframe.