Fuel prices may increase slightly the first half of this year – unless global events cause increases.
Custom harvesters who keep track of current events may get a sense of where fuel prices might be headed this spring.
“My most recent forecasts show prices up slightly from year-ago levels in the first half of the year and then below in the second half, resulting in an average for the year to be similar to 2013. However, with the current situation in Ukraine and Russia, things could change considerably in a short amount of time,” says Kevin Dhuyvetter, Kansas State University Extension ag economist.
If a war were to break out in that part of the world, he predicts that fuel prices would go up quickly.
“I don’t know what will happen or the probability of something happening, but anytime there’s a greater risk of international instability, markets react,” he says. “Of course, the situation over there could turn out to be a non-issue as it relates to fuel prices if things remain relatively calm.”
At press time, prices for taxable diesel fuel were hovering around $4/gallon. In 2013, the average price was $3.92/gallon, according to the U.S. Energy Information Administration, a branch of the U.S. Department of Energy.
“Based on my forecasts for non-taxable farm fuel, prices in 2014 will be very similar to (those of) the last three years. The good news is, that means prices aren’t projected to be a lot higher. The bad news is that prices in those three years have been at all-time highs,” adds Dhuyvetter, who closely watches the crude oil futures market and then analyzes what it implies for diesel fuel prices.
For price information and his analysis, which is updated monthly, visit www.agmanager.info.