The U.S. retail pump price average for diesel declined again this week, according to data tracked by the Energy Information Administration (EIA), while a new report expects global oil prices to remain depressed for the next decade.
The national average for diesel fell 4 cents this week to $2.84 per gallon, EIA noted; that’s $1.151 per gallon cheaper compared to the same week in 2014.
Prices for diesel dropped in every region of the country, the agency said, with prices in only three now remaining above the $3 per gallon mark:
- California at $3.096 per gallon, down 5.6 cents for the week;
- New England at $3.164, down 3.6 cents;
- The Central Atlantic at $3.179, down 5.2 cents.
Fuel costs could also remain on a downward trend over the next decade, as global oil prices may stay low for the next 10 or 20 years, according to Frank Wolak, who serves as the Holbrook Working Professor of Commodity Price Studies in the Department of Economics at Stanford University.
He said in a new report issued this week that the most likely medium-term price point for global oil prices over the next one to two decades is $50 to $70 per barrel.
And while geopolitical and environmental issues may unexpectedly arise that turn oil prices upward, Wolak in a new policy brief for the Stanford Institute for Economic Policy Research that many factors point to lower oil prices for the foreseeable future – with the primary reasons including the slowing demand for oil in the industrialized world and ever-advancing technological change in the extraction and use of oil.
Record domestic oil production is adding to that downward price pressure as well, EIA added.