Fuel Prices Jump, Gas Up 20%, Diesel Climbs 10% Since January
If you’ve filled your car’s tank recently, you almost certainly noticed you were paying more. Since the start of 2012, diesel fuel prices have climbed by almost 10% while gasoline prices rose 20%, according to the U.S. Energy Information Administration.
As of Monday, diesel cost an average of $4.142 per gallon, a 9.5% increase since January, and a 4.175% ($0.166) increase from the same period last year.
Gasoline prices have also continued to rise nonstop, hitting $3.941 per gallon this week, up 19.5% since January, and 6.976% ($0.257) from the same period last year.
In the commodities market, the price of one gallon of gasoline closed Tuesday at $3.40, an 11-month high.
One of the main reasons for the continued increase in fuel prices over 2011 figures is the loss of oil refineries in the Northeast and the U.S. Virgin Islands. Refineries in the Northeast don’t have access to much of the crude oil produced in the Midwest due to an insufficient number of pipelines and, as a result, have to import more oil from overseas.
Sunoco, one of the country’s largest refiners, recently announced they would close a major Northeast refinery in July, taking as many as 335,000 barrels per day of refining capability off the market.
Hovensa, is a joint venture of Hess, a U.S. oil company, and Petróleos de Venezuela located in the U.S. Virgin Islands and one of the world’s largest refineries, announced in January that it plans to close its refining operations, following a $1.3 billion loss. The refinery’s loss was a result of weak demand and high operating costs, though it will continue operating as an oil storage facility in the future.
Earlier this year, the U.S. Department of Energy warned of the possibility of a oil shortfall in the Northeast as early as July, which could lead to both diesel and gasoline prices hitting the $5 per gallon mark.