Diesel fuel price fluctuations

Diesel engines are often more fuel-efficient than gasoline engines, which can make diesel fuel more cost-effective for certain vehicles or applications. Even so, these prices can fluctuate for a variety of reasons. So, what’s going on with diesel pricing? Let’s take a closer look.

Factors that affect diesel fuel prices

Diesel fuel prices go up due to a variety of factors, including global demand, supply and production costs, taxes, and government regulations.

• Demand. Generally, diesel fuel prices tend to rise when global demand increases or when production costs increase. Diesel fuel demand is currently increasing due to increased global economic activity and the need for transportation. Additionally, the demand for diesel fuel is expected to continue to rise in the coming years as the global economy continues to grow.
• Supply. The world’s diesel fuel supply is currently adequate to meet global demand. However, supply disruptions due to geopolitical tensions and other factors can cause supply to become tight, resulting in higher prices.
• Taxes and regulations. Taxes and regulations both affect the cost of diesel fuel by increasing the cost of production, making diesel fuel more expensive for consumers. Regulations can include environmental regulations, safety regulations, and other regulations that increase the cost of production.
• Refining, production and distribution costs. The process of refining crude oil into diesel fuel incurs costs, including refining, transportation, and distribution. If these costs increase, such as due to maintenance or upgrades at refineries, it can contribute to higher diesel fuel prices. Additionally, the cost of labor and other overhead costs can also affect the production costs of crude oil, which in turn contributes to the rise in diesel fuel prices.

The relationship between crude oil and diesel fuel prices

The price of crude oil is currently rising due to increased global demand, supply disruptions, and geopolitical tensions. Additionally, the US dollar exchange rate can also have an impact on diesel prices. More recently, the U.S. dollar has weakened, which contributed to the rise in crude oil prices.

What does this mean for diesel customers? Diesel fuel is a blend of refined crude oil and biomass materials. In other words, because diesel fuel is produced by refining crude oil, the price of diesel fuel is directly affected by the cost of crude oil.

Trust Fredericks Fuel as your diesel fuel supplier

At Fredericks, we understand that affordable diesel fuel can make a big difference to the success of your business – including farms, landscapers, builders, excavators, pavers, movers, waste haulers, truckers, foodservice, courier and delivery industries, and more. That’s just one reason why our customers continue to rely on Fredericks Fuel for both on- and off-road diesel fuel to meet all their transportation, equipment and heating needs. With plentiful on-site storage, Fredericks Fuel offers competitive pricing and a dependable supply of both on- and off-road diesel fuel.

Visit our Wantage plant for on- or off-road diesel or reach out to schedule a fuel delivery. If you are located in Oak Ridge, Sparta, Wantage or anywhere in Northern NJ, contact us today to learn why Fredericks Fuel should be your diesel fuel supplier.