(WXYZ) — Gas prices across Southeast Michigan continue to fall. According to AAA, today's average gas price in Michigan is around $3.21.
But another crude oil byproduct, diesel, is still high both in the state and across the country.
The U.S. consumes approximately 63 billion gallons of diesel a year.
Michigan consumes approximately 1.1 – 1.2 billion gallons of diesel a year.
This not only impacts the logistics industry but also the everyday person as higher fuel costs mean higher costs for goods.
Kevin Gaynor is from Ann Arbor. And after being a truck driver for 5 years, Gaynor says times like this, he feels sorry for trucking companies.
"They got to pay not only for their trucks to get fixed, but the fuel they need too," said Gaynor.
Driving trucks for over 25 years, Keith Butcher says the current diesel prices are high. It makes him think about the time when diesel was under a dollar per gallon.
"I just know that it drives prices of everything else up, everything like a gallon of milk outrageous just because it costs so much to put it on trucks to drive it over here," said Butcher.
And to put things into perspective, the logistics industry heavily relies on diesel fuel, including ships and trains, among other modes of transportation.
Oil and Gas entrepreneur Michael Evans says diesel is a global commodity. There are many factors behind the current prices.
"We’ve had just a tough building diesel inventory in the US diesel inventory at an all time low here over the last year," said Evans.
This chart by the US Energy Information Administration shows the country’s diesel inventory has dropped over the last 2 years.
Local issues include the refinery in Toledo still not running at optimal level after the September fire incident.
"One of the scary parts is it that refineries are running at over 95% efficiency right now that is not sustainable. That’s a very high rate for the refineries to be running and they have to go in to turn around and maintenance," said Evans.
This would once again drop the supply level leading to further increase in prices. Meanwhile, international factors like the Ukraine-Russia war, OPEC production levels along with price caps are all contributing to high diesel prices.
"So there is not a real great short-term solution unless you cut down on your exports," said Evans. "I think the long-term solution is still conservation, as we move away from fossil fuels and find new technologies for us to do that we will see some levels of relief."
Meanwhile, Evans predicts the current fuel price trend will stick around for at least the next few weeks, that’s higher diesel prices and lower gas prices.
