Diesel Prices Drop in a Way They Haven’t in Two Years

Drivers with diesel engines are finally getting some relief at the pump as a pattern of price drops continues in a way that hasn’t been seen since 2021.

For the first time in over two years, average diesel prices in the U.S. today will fall below their year-ago levels, according to GasBuddy, the leading fuel savings platform saving North American drivers the most money on fuel. Diesel prices have declined nearly $1.50 per gallon since reaching record levels last spring. They now stand at an average of $4.35 per gallon, the lowest level since 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.

Courtesy Pexels & Engin Akyurt

“Coming out of winter, we’ll continue to see diesel prices decline. Barring an unexpected disruption or escalation in global events, diesel prices this summer could be $2 per gallon lower than last summer, De Haan says.

Diesel by the numbers:

• Seven states where diesel prices average below $4 per gallon: OK, TX, KS, WI, MO, IA, AR
• Most common diesel prices in the U.S., in order: $3.99, $4.09, $3.89, $4.29, $4.19
• $3.62/gal: the average of the lowest priced 10% of stations in the U.S.
• $5.82/gal: the peak in the national average price of diesel hit in 2022
• 78 cents: the amount of decline to average diesel prices in the last 90 days

Retail diesel prices will likely continue falling as demand continues to ease and winter heating oil consumption declines.

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.