Overview
- The national average for diesel reached $5.85 per gallon on Friday, Sept. 4, according to the American Automobile Association.
- Markets credit the jump to renewed U.S.-Iran strikes that have disrupted tanker traffic through the Strait of Hormuz alongside damage to Middle East refineries and Ukrainian strikes on Russian refining capacity.
- U.S. distillate inventories are at historically low levels for the season, the Energy Information Administration reports, and refiners have pushed operating rates up to capture record refining margins.
- Higher diesel is already raising costs for trucking, farming and refrigerated shipping, with some companies adding fuel surcharges and analysts warning these expenses can feed into higher grocery and consumer prices.
- Analysts say limited spare refining capacity and Russian export limits mean prices could remain elevated even if crude eases, and meaningful relief requires restored flows from the Persian Gulf or resumed Russian exports.