Russian diesel deal having limited impact, if any, on prices
The diesel market is going through its typical recent volatility, and there doesn’t seem to be much impact from the Trump deal with Russia. The post Russian diesel deal having limited impact, if any, on prices appeared first on FreightWaves .
The latest weekly average retail diesel benchmark release is delayed due to the Columbus Day holiday, which is likely to show another decline even as the industry discussion remains bullish. Since the Department of Energy/Energy Information Administration price was published on October 8, the futures price of ultra low sulfur diesel (ULSD) has been volatile, fluctuating due to the ongoing military action against Iran.
However, the overall trend in the last week has been upward. The ULSD settled at $4.5694/gallon on October 6, then increased to more than $4.88/gallon within two days before dropping to $4.7232/g on Monday. Despite President Trump's announcement of a deal to purchase Russian diesel, it only resulted in a 1.52 cents per gallon decrease in the price on the day.
The DOE/EIA price to be released on Wednesday will be the first since the Trump administration's announcement of the deal, which has largely been dismissed as irrelevant to supply/demand trends. The recent drop in diesel prices can be attributed to a 17-day run where the national average fell every day, starting at $6.5276/g on September 22 and ending at $6.2785/g on Friday.
Despite the volatility in the market, analysts believe that Russia's diesel supply would have a limited impact on prices, as consumers buy refined products rather than crude.
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