By Siddharth Cavale, Nicole Jao and Jarrett Renshaw
NEW YORK, Sept 10 (Reuters) – The U.S. national average price of diesel on Thursday surpassed $6 a gallon for the first time ever, according to price tracker GasBuddy, as the U.S.-Israeli war on Iran and Ukrainian attacks on Russia’s refineries have squeezed supply.
Diesel underpins much of the world’s economic activity, fueling the trucks, trains, ships and heavy equipment that keep supply chains running, as well as the farming industry. Rising fuel prices have weighed heavily on consumers this year who were already contending with inflation. They have become a pain point for President Donald Trump and Republican lawmakers trying to maintain thin majorities in the U.S. Congress in the midterm elections in November.
Record diesel prices come as oil futures have climbed back above $100 a barrel on the intensification of conflict between the U.S. and Iran. On Thursday, crude oil futures hit their highest level since mid-May, with Brent settling at $107.63 a barrel and West Texas Intermediate futures settling at $102.48 a barrel. Crude oil is the biggest driver for fuel prices.
“Every truck, every delivery, every package, every grocery run just got more expensive,” GasBuddy analyst Patrick De Haan said on social media site X.
“Record diesel prices will impact every cargo, shipment, every delivery Americans are taking, and are likely to reignite inflation up and down the supply chain,” he said. Average U.S. diesel prices are up roughly $2.30 from a year ago, according to the fuel tracker.
Rising fuel and transportation costs threaten to accelerate inflation as midterms loom and Republicans struggle to convince voters that Trump’s policies are improving affordability.
A Reuters/Ipsos poll last month found Democrats held an eight-point advantage over Republicans on which party had the better approach to the cost of living. Trump acknowledged on Wednesday that relief from the oil-price surge may not come until after the election.
Diesel inventories are currently 13% below their five-year average, according to the U.S. Energy Information Administration, at 106.3 million barrels. Stocks rose last week as refiners were running their plants at full tilt due to strong refining margins.
“The diesel situation is continuing to be more bullish by the day. Russian diesel exports, or lack thereof, continue to be the biggest factor in the market,” said Alex Hodes, an energy analyst at StoneX.
“The recent escalation by the Houthis in Saudi Arabia will possibly affect diesel exports out of the Yanbu port on the Red Sea which accounts for around 400-500 Kb/d of diesel,” he added.
(Reporting by Shariq Khan in New York, Siddharth Cavale, and Nicole Jao in New York and Jarrett Renshaw in Philadelphia ; Writing by Liz Hampton; editing by David Gaffen and David Gregorio)
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