The U.S. Energy Information Administration (EIA) projected that the U.S. on-highway diesel fuel price will fall in 2025 and 2026 in its latest short term energy outlook (STEO), which was released on August 12.
In this STEO, the EIA forecast that the U.S. on-highway diesel fuel price will average $3.66 per gallon this year and $3.47 per gallon next year. The EIA highlighted in its August STEO that the U.S. on-highway diesel fuel price averaged $3.76 per gallon in 2024.
The EIA’s August STEO showed that the EIA sees the U.S. on-highway diesel fuel price averaging $3.78 per gallon in the third quarter of 2025, $3.66 per gallon in the fourth quarter, $3.49 per gallon in the first quarter of next year, $3.36 per gallon in the second quarter, $3.47 per gallon in the third quarter, and $3.57 per gallon in the fourth quarter.
In its previous STEO, which was released in July, the EIA projected that the U.S. on-highway diesel fuel price would average $3.61 per gallon in 2025 and $3.59 per gallon in 2026. That STEO also highlighted that the U.S. on-highway diesel fuel price averaged $3.76 per gallon last year.
The EIA’s July STEO forecast that the U.S. on-highway diesel fuel price would average $3.67 per gallon in the third quarter of 2025, $3.59 per gallon in the fourth quarter of this year and first quarter of 2026, $3.56 per gallon in the second quarter, $3.58 per gallon in the third quarter, and $3.61 per gallon in the fourth quarter of next year.
“We forecast the U.S. retail diesel price will average almost $3.70 per gallon in 2025, down three percent from 2024,” the EIA said in its August STEO.
“Diesel prices in our forecast fall by another five percent in 2026,” the EIA added in its latest STEO.
Declining Price Trend
The EIA’s latest diesel fuel update, which was released on August 19, showed a declining trend for the U.S. on-highway diesel fuel price.
That update showed that the U.S. on-highway diesel fuel price averaged $3.800 per gallon on August 4, $3.754 per gallon on August 11, and $3.713 per gallon on August 18.
Of the five Petroleum Administration for Defense District (PADD) regions highlighted in the EIA’s latest fuel update, the West Coast was shown to have the highest on-highway diesel fuel price as of August 18, at $4.455 per gallon. The Gulf Coast was shown in the update to have the lowest on-highway diesel price as of August 18, at $3.340 per gallon.
A glossary section of the EIA site notes that the 50 U.S. states and the District of Columbia are divided into five districts, with PADD 1 further split into three subdistricts. PADDs 6 and 7 encompass U.S. territories, the site adds.
The AAA Fuel Prices website shows that the average U.S. diesel price was $3.681 per gallon on August 25. Yesterday’s average was $3.686 per gallon, the week ago average was $3.690 per gallon, the month ago average was $3.741 per gallon, and the year ago average was $3.708 per gallon, the AAA Fuel Prices website showed.
According to the site, the highest recorded average price for U.S. diesel was seen on June 19, 2022, at $5.815 per gallon.
What Do You Pay For?
The EIA’s latest diesel fuel update, which pegged the retail price of U.S. diesel at $3.60 per gallon in June, showed that crude oil costs made up 45 percent of that price, distribution and marketing costs made up 20 percent, refining costs made up 19 percent, and taxes made up 17 percent.
An EIA diesel fuel update released on May 13, which pinned the retail price of U.S. diesel at $3.59 per gallon in March 2025, showed that 46 percent of that total went towards crude oil costs, 23 percent went towards distribution and marketing costs, 17 percent went towards taxes, and 15 percent went towards refining costs.
To contact the author, email andreas.exarheas@rigzone.com
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