The US Department of Energy/Energy Information Administration said the benchmark weekly retail diesel price rose to US$3.837 a gallon, its highest level since July 2024, driven by tight inventories, reports American Shipper.

The price climbed 8.4 cents effective Monday, marking the third consecutive weekly increase. Diesel has risen 21.7 cents in three weeks, the longest run of gains since last July. The benchmark is used widely for fuel surcharges.

US distillate inventories fell from 123.6 million barrels in late September to 111.5 million barrels by the end of October, according to EIA data. About 88 to 90 per cent of those stocks are ultra low sulphur diesel consumed by trucks. Inventories usually build ahead of winter but are declining, pushing diesel higher.

On the CME commodity exchange, ULSD (Ultra-Low Sulphur Diesel) settled at $2.4053 a gallon on November 3 before climbing 7 per cent to $2.5757 in six trading days. Brent crude rose just 0.4 per cent in the same period. The backwardation in ULSD widened to nearly six cents a gallon on November 6, reflecting tight supply.

The spread between diesel and gasoline retail prices reached 91 cents a gallon, the highest since early 2024. ULSD futures also showed a plus-dollar spread over Brent, a level not seen since February 2024.

Diesel markets turned volatile Wednesday, with ULSD down 8.93 cents to $2.4864 by late morning, a 3.47 per cent drop. Analysts said the decline followed OPEC's monthly report forecasting supply and demand balance, a more bearish stance than earlier outlooks.