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by Josh Delfosse
Josh Delfosse

4 min read

Summer Driving Season 2024: Energy Market Expectations

May 30, 2024

Josh Delfosse
by Josh Delfosse


In the United States, summer driving season, generally the period between the U.S. holidays of Memorial Day and Labor Day, is a time when refiners across the country ramp up production of transport fuels to meet robust gasoline demand. While gasoline demand and prices may experience the most significant change over the summer, this unique period of seasonal demand also comes with plenty of price implications for diesel and other refined products.

Energy Market Expectations for Transport Fuel Demand and Prices

Thus far in 2024, energy demand has decreased compared to last year. According to the most recent U.S. Energy Information Administration (EIA) report, gasoline and diesel demand is down 1.8% and 6.1% respectfully from last year (see figure 1 below displaying U.S. diesel demand).

U.S. Distillate Product Supplied.png

Whether lower demand for transport fuels persists through the summer will be the topic of much speculation. A large driver of lower transport fuel demand is high inflation. The U.S. Federal Reserve has continued to implement strict monetary policy by maintaining high interest rates, which has increased the cost of borrowing, decreasing consumer spending. Another market driver that could add upward price pressure on transportation fuels is hurricane season. Experts anticipate a record-breaking hurricane season this year. These disruptions can impact energy infrastructure and shutdown oil platforms or refineries in a specific region, leading to upward price pressure in a certain region or across the nation.

U.S. Refiners Maximize Utilization Rates Amid Rising Gasoline Demand

While risks will continue to drive market volatility, clearer economic fundamental trends will shape transportation fuel markets and influence prices over the coming months. To begin, the steep increase in gasoline demand will likely encourage U.S. refiners to operate at their highest utilization rates of the year. Utilization rates is a key metric for the U.S. refining industry and consumers of transport fuels like gasoline and diesel because it influences market dynamics. For example, rates typically increase in June through August, peaking in July. With the increase in gasoline demand around Memorial Day, refineries are economically incentivized to maximize their operable capacity. Gasoline continues to dominate refinery yields as the product accounts for most average refined barrels across the U.S.

Seasonal Variations in Diesel Fuel Prices

Gasoline production also boosts diesel production, among a myriad of other refined products. In the U.S., an average refinery will produce about 19 gallons of gasoline, 11 gallons of diesel, 45 gallons of petroleum products from a single barrel of crude oil.

From a seasonal perspective, major freight movers usually experience price relief for diesel fuel during summer driving season because diesel demand does not peak at the same time as gasoline demand. The monthly average wholesale price of diesel fuel in the U.S. typically experiences a decrease from the month of May to June and peaks in autumn due to greater diesel demand for agriculture and across other industries.

2024 Summer Driving Season Trends in Wholesale Diesel Prices

This year, wholesale diesel prices have trended with historical demand and refinery utilization patterns while being jostled by volatility from other market-moving events. Prices are experiencing relief through the combination of slightly relaxing demand and refineries increasing the supply of gasoline, therefore pushing more diesel into the market. Figure 2 below shows that, on average, prices this year are trending closely with last year’s wholesale diesel prices. However, prices historically rise in autumn when diesel demand peaks.

U.S. Wholesale Diesel Price History.png

Insights and Solutions for the U.S. Energy Market

Economic trends, seasonal demand variations, and unexpected market disruptions continue to shape transportation fuel energy prices in the U.S. As refiners navigate these factors, consumers will experience fluctuating prices for both gasoline and diesel. Understanding these dynamics is crucial for making informed decisions in the energy market. For more detailed insights and to leverage a market-based fuel reimbursement program, please contact us!

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