NASHVILLE, TENN. (RFD NEWS) — A peace deal remains in effect between the United States and Iran, helping to cool oil prices after months of volatility. However, a petroleum analyst at GasBuddy says several factors continue to influence fuel markets.
“While prices are declining, global oil inventories have been declining at near record pace,” Patrick De Haan said. “And it probably will take 6 to 12 months to get those global oil inventories back to pre-war levels. So while prices are declining, they were made elevated. The national average still up 76 cents a gallon from last year. Maybe by late this year, we could see the national average getting close to pre-war levels. Diesel prices maybe as well. But there’s also things like hurricane season to contend with that recovery.”
De Haan also offered advice to farmers preparing to purchase diesel fuel.
“Farmers, thinking about buying significant amounts of diesel, would want to put those deliveries off as long as possible, buy just what they need in the interim,” he said. “Motorists as well. I do expect that by the end of the year, the national average may fall below the $ 3-a-gallon mark for gasoline. Diesel could fall closer to the $ 4-a-gallon mark. So, you know, we’re talking about some downside by the end of the year of maybe 50 cents to as much as $1.25 a gallon for diesel.”
According to AAA, the national average price for diesel was $5.01 per gallon this morning. That is down from $5.19 a week ago and $5.64 a month ago. However, it remains well above the $ 3.67-per-gallon average recorded at this time last year. Gasoline prices averaged $3.92 per gallon on Monday morning.
Fuel Costs and the Fight for E15 Expansion
One area that could help ease fuel costs is expanded access to biofuels. During a recent trip to Washington, D.C., the Nebraska Farm Bureau urged lawmakers to move forward with year-round sales of E15.
“Our message around the office is that it really shouldn’t be this hard, but unfortunately, it has been,” said Jordan Dux with the Nebraska Farm Bureau. “And so, trying to get that bill across the finish line. There are two pieces to it. They’re trying to fix the administrative side, which would allow for sales of E15 year-round, without this government waiver we’ve been working under for the past few years. And then you also have some reforms when it comes to some small refinery exemptions. That’s the sticking part. That’s the part that’s been difficult.”
Legislation to make year-round E15 sales permanent currently remains before the Senate. Agricultural leaders say the measure will likely need to be attached to a larger legislative package in order to receive a floor vote.
Senator Chuck Grassley (R-IA) says he hopes to see the bill approved this year, but warns upcoming federal spending negotiations could delay progress.
“Then you have a continuing resolution until Thanksgiving,” Grassley said. “Then you don’t pass appropriations bills, and you have a continuing resolution until Christmas. And then Christmas comes, and you have a continuing resolution that takes you, maybe, over into the new calendar year, the middle of February. And if those are all clean appropriation bills, where are you going to put E15?” Grassley said.
Sen. Grassley warns that if a government shutdown occurs later this year, year-round E15 legislation could once again be pushed aside.
Meanwhile, Senate Majority Leader John Thune says the Farm Bill could also become caught up in the same delays tied to federal spending negotiations.
Farm Groups Push Senate to Advance Long-Awaited Farm Bill
During a recent trip to Washington, D.C., the Nebraska Farm Bureau told lawmakers it wants to see a new five-year Farm Bill passed before the end of summer.
“Getting that five-year Farm Bill done has been on the top of our priority list for a number of years now,” Dux said. “A reminder is that a majority of the Farm Bill was passed as a part of the One Big Beautiful Bill, but it still is dependent upon year-in, year-out authorization. And there are still some other programs we need to get fully funded, too. So, trying to get that bill across the finish line. We saw some movement on the House side. It made it through there, but we still have some work to do on the Senate side. And hopefully later this summer, we will start to see some movement there.”
The National Farmers Union is also calling for action on the legislation.
“We outlined these concerns in this letter, and with the focus on farm policy through the Farm Bill,” said Aaron Shier of the National Farmers Union. “With all of the challenges in the farm economy, we think now is really an important time to take action and for Congress to take action to strengthen the farm safety net for farmers, which is really what we’re outlining and calling for in this letter.”
Shier said the organization recently sent a letter to Senate agriculture leaders urging them to strengthen the farm safety net as producers continue to face economic challenges.
Meanwhile, Senate Agriculture Committee Chairman John Boozman told Agri-Pulse he hopes to release Farm Bill text before the week is over.
