On Friday, diesel prices in the U.S. hit $6.0556 per gallon for the first time, marking a 63% increase compared to last year, as reported by AAA. California sees even higher prices at $7.9827 per gallon.
The surge in diesel costs is attributed to rising crude oil prices, which exceeded $100 per barrel for the first time since May, driven by escalating tensions in the Middle East and Eastern Europe.
Bob McNally, president of Rapidan Energy, emphasized that diesel is crucial for the economy, powering transportation and agricultural machinery, and its rising costs will ultimately affect consumer prices for goods and services. Patrick De Haan from GasBuddy noted that Americans are now spending an additional $700 million daily on fuel compared to last year, indicating significant consumer impact.
The ongoing conflicts have disrupted global fuel supplies, with a loss of nearly 8% of the world's diesel supply and no spare refining capacity to compensate for the shortfall. Helima Croft from RBC Capital Markets highlighted the challenges this poses for the U.S. administration, as refineries are operating at nearly full capacity