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US Diesel Prices Reach All-Time High Amid Iran Conflict
Confirmed
In Short: US diesel prices have hit an all-time high, surpassing $5.85 per gallon, according to the American Automobile Association (AAA).
Diesel prices in the US have reached an all-time high, with the average price for one gallon hitting $5.85, up from $3.71 a year ago. This surge is linked to the Iran conflict and the resulting rise in wholesale oil prices.
The Iran conflict, which began in late February, has significantly impacted global fuel markets, leading to higher diesel prices. Even though gasoline demand typically decreases in the fall, this year's prices are driven by geopolitical tensions.
The rise in diesel prices has stretched household budgets, with Americans spending over $741 more per household since the start of the Iran war, according to a tracker from Brown University. This increase is particularly concerning for school bus operators, as 90% of school buses run on diesel.
Geopolitical tensions, including Ukraine's attacks on Russian oil refineries and Russia's curtailment of diesel exports, have further tightened the global fuel market. These factors have contributed to the record-high prices, which are expected to continue due to the volatile nature of the situation.
The impact of these high diesel prices extends beyond transportation, affecting the cost of goods and services. 'Diesel is the blood of the economy,' said Brito, highlighting its critical role in moving goods, food, and agricultural products.
The rise in diesel prices has also pushed up transport costs for many everyday products, including groceries, clothes, and furniture. This trend is exacerbating inflation, which has been a concern for central bankers and consumers alike.
What's confirmed
What's still developing
- The average price for one gallon of diesel in the US has hit $5.85, compared to an average of $3.71 a year ago and above the previous high following Russia's full-scale invasion of Ukraine, according to the American Automobile Association (AAA).
- Gas prices have never topped $4 per gallon on Labor Day, the motor club noted.
- "The everyday consumer will see higher diesel prices in the consumer goods they purchase," said Susan Bell, senior vice president of downstream research at Rystad Energy.
- Iran Says It's Found Ways to Dodge U.S. Oil Blockade What I Cover Tsvetana Paraskova is an energy and commodities journalist who has contributed to Oilprice.com for nearly a decade, covering global energy markets, commodities,… The average U.S. diesel price hit a record high late on Thursday, exceeding the previous record from 2022, as the Middle East crisis tightened global fuel markets and sent prices soaring this summer.
- As of Thursday afternoon, the live U.S. national average price of diesel set a new record at $5.820 per gallon, according to GasBuddy data.
- "Diesel prices have skyrocketed since Trump started his war with Iran," Democratic Sen. Mark Kelly of Arizona declared in a Thursday post on X.
- Prices for most types of petroleum products have gone up since the war with Iran began in late February, limiting how much could flow through the Strait of Hormuz.
- Ukraine's recent attacks on Russian oil refineries have taken many diesel refineries offline; consequently, Russia has curtailed its own diesel exports, and has even started importing fuel from countries like India, Kazakhstan and Belarus.