Demand for diesel
increases fuel prices

Posted October 27, 2010 at 2:54 pm

According to the Energy Information Administration, national fuel prices increased in the last half of September and first part of October after backing off during the previous month.

“Although diesel prices have risen for three consecutive weeks and exceeded the $3 mark, Iowa remains about 5 cents below the national average,” said Kerri Johannsen, data analyst for the Iowa Office of Energy Independence. “Peak demand for diesel fuel due to the early harvest is the main reason that caused Iowans to experience escalating fuel prices and disruptions in delivery of diesel and gasoline.”

Governor Culver signed a proclamation temporarily suspending the hours of service regulation on Oct. 8 in order to provide emergency relief to Iowans from increased fuel prices and ensure them receiving timely delivery of fuels.

The Oct. 18 average price of 10 percent ethanol blended mid-grade gasoline in Iowa was $2.70 per gallon, which is 14 percent higher than the October 2009 price of $2.37 per gallon of the same blend.

The Oct. 18 average price for diesel in Iowa was $3.04 per gallon, which is 16.5 percent higher than the October 2009 price of $2.61.

On Oct. 15, a barrel of West Texas Cushing Sweet Crude Oil was $81.25. The price is a 10.3 percent increase compared to the September price of $73.66 and 3.5 percent higher than the October 2009 price of $78.53.

On Oct. 15, natural gas was trading at $3.43/MMBtu, which is 52 cents lower than one year ago, a 13.2 percent decrease. It is a 16 percent decrease compared to the September natural gas price of $4.08/MMBtu.

The U.S. Department of Energy, Energy Infor-mation Administration reports that working natural gas in storage as of Friday, Oct. 8, was 3,590 Billion cubic feet (Bcf), 7.4 percent higher than the 5-year average (2005-2009) and 3.2 percent lower than the level during the corresponding week last year.

A heating oil and propane survey has been conducted weekly by the Iowa Office of Energy Independence since Octo-ber. The average Iowa propane charge price in the Oct. 18 survey was $1.63 per gallon, holding steady over the past three weeks. Total U.S. inventories of propane experienced a modest seasonal build of 0.3 million barrels over the past week to reach 64.3 million barrels, ahead of the fall crop-drying and winter heating seasons, though 7.3 million barrels below last year’s level at this time.

Demand for diesel
increases fuel prices

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