U.S. Diesel Prices Close In on April War Peak
OPEC+ Set to Hold Oil Output Steady as Iran War Disrupts Supply The leading economics blog online covering financial issues, geopolitics and trading.
A diesel-price shock may be approaching Western economies.
That's because the industrial fuel sits at the epicenter of freight, agriculture, construction, and heavy industry; soaring prices ripple quickly through supply chains, raising transportation and construction costs, reigniting food inflation, weakening consumer sentiment, and intensifying margin pressure on small and medium-sized businesses.
The latestAAA datashow that the nationwide average retail price reached $5.69 per gallon.
That leaves diesel just below its April peak, which marked the highest price since mid-2022.
The renewed surge comes as theUS-Iran conflict has deepenedso far this week with tit-for-tat attacks, further disrupting any full near-term normalization of the Strait of Hormuz.
The US is currently operating the Oman shipping corridor. Beyond the Gulf disruptions, Ukrainian attacks on Russian refineries are constraining exports from one of the world's largest fuel suppliers.
The simultaneous shocks are rippling through the global refining complex, which was already plagued by limited spare capacity.
Earlier this week, President Trump summoned top US refining executives for a closed-door meeting and leaned on them to increase diesel and gasoline production, withdiesel creeping toward $6 per gallon nationally and gasoline rising above the politically sensitive level of $4 ahead of November's midterm elections.
Bloomberg'sNYMEX one-month heating-oil/crude spread, tracked on the BBG Terminal as theHOCL1 Index, breached $100 per barrel early Tuesday before surging to $108 overnight.
It was trading at $104 early Wednesday morning.
"A choppy start to the month so far, with oil and yields continuing to rise, while volatility is also gradually picking up.This comes after President Trump downplayed hopes of a new deal with Iran.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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