US diesel prices exceed $6.50 per gallon for first time

The national average price of diesel fuel in the US hit $6.505 per gallon on September 21, according to data from the American Automobile Association. That’s a number no American trucker, farmer, or logistics executive has ever seen on a national scale, and it carries consequences that extend far beyond the fuel pump. To put that figure in perspective: diesel crossed the $6 threshold barely ten days earlier, around September 10-11. Year-over-year, diesel prices are up roughly 60%. Why diesel, and why now The more immediate pressure comes from the ongoing US-Israeli conflict with Iran, which has disrupted shipping through the Strait of Hormuz. Roughly 20% of the world’s oil passes through that narrow waterway on any given day. Meanwhile, Ukrainian military operations targeting Russian refineries have prompted Moscow to impose restrictions on diesel exports. Russia has historically been one of Europe’s largest diesel suppliers, and those barrels need to come from somewhere else now. The result: US diesel inventories have fallen to 106.3 million barrels, roughly 13% below the five-year average. That’s not a comfortable cushion heading into the fall harvest season, when agricultural de...