Overview
- Retail diesel reached all‑time national highs in mid‑September, with averages reported around $6.31–$6.40 per gallon and state records in places such as Michigan where diesel climbed above $6.30.
- The price spike follows a string of supply shocks, including disruptions to Strait of Hormuz shipping, Houthi attacks on tankers, Ukrainian strikes on Russian refineries and damage to Saudi Arabia’s East‑West pipeline that have removed export barrels.
- U.S. refineries are operating near full capacity while distillate inventories sit about 13% below the five‑year average, limiting the industry’s ability to produce more diesel quickly.
- Higher diesel is already raising costs for trucking, rail and farm operators and is expected to translate into freight surcharges and upward pressure on food and consumer prices, straining household budgets.
- Policymakers face mounting pressure to act but short‑term options such as strategic releases, talks with refiners or export limits have trade‑offs and officials and analysts warn prices could climb further in the coming days.