The national average price of diesel reached a nominal record $5.85 a gallon Friday as the six-month war with Iran disrupted oil flows through the Strait of Hormuz, raising transportation costs for food, consumer goods, shipping and other parts of the U.S. economy.
By yourNEWS Media Newsroom
U.S. diesel prices climbed to a record national average of $5.85 a gallon Friday as the six-month war with Iran continued disrupting global energy supplies and pushing up the cost of moving goods throughout the American economy.
The increase surpassed the previous nominal record of nearly $5.82 a gallon set in June 2022 and is already increasing expenses for trucking companies, retailers, farms, shipping firms and other businesses that depend heavily on diesel-powered transportation and equipment.
Regular gasoline has also risen sharply, though more slowly. The national average for regular unleaded stood at $4.15 a gallon Friday, compared with $3.20 at the same time last year, according to AAA.
Higher diesel prices are particularly significant because the fuel is deeply embedded in freight and food distribution networks. Trucks, trains, cargo vessels, farm machinery and fishing boats all rely heavily on diesel, meaning increases at the pump can eventually work their way into the prices consumers pay for groceries, clothing, furniture, cosmetics and other everyday goods.
The economic effects could also become politically significant as voters approach November’s midterm elections with inflation, fuel costs and household expenses likely to remain major concerns.
The immediate pressure is particularly noticeable in food distribution.
Diesel powers farm machinery used to harvest crops as well as much of the equipment and transportation required to move produce, meat, seafood and other perishable goods from farms and processing plants to grocery stores.
Fuel represents roughly 15% to 30% of the total cost of food, according to the Independent Grocers Alliance, which represents approximately 7,500 supermarkets globally.
Because transportation contracts and retailer margins can temporarily absorb higher fuel expenses, however, those costs do not necessarily appear at grocery stores immediately.
David Ortega, a professor of food economics and policy at Michigan State University, said the impact can become more visible as contracts are renewed and fuel surcharges increase.
“Early on, much of the cost increase gets absorbed along the supply chain through existing freight contracts and retailer margins,” Ortega said. “But as contracts reprice and fuel surcharges take hold, more of that cost makes its way to the grocery store.”
Refrigerated and frequently transported foods are often among the first products to experience higher costs.
In July, overall U.S. grocery prices were 2.7% higher than a year earlier, while seafood prices had increased 7% and fresh fruit was up 4.9%.
Ortega cautioned that transportation expenses are only one factor affecting food prices.
Lettuce, for example, faced higher freight costs in July but fell in price as demand declined during a cyclospora outbreak.
The impact of expensive diesel is also being felt beyond grocery stores.
Amazon introduced a temporary 3.5% fuel and logistics surcharge in April on some third-party sellers.
United Parcel Service, FedEx and the U.S. Postal Service also imposed additional fees on certain shipments earlier in the war, citing higher fuel-related operating expenses.
Ajesh Kapoor, founder and CEO of trucking technology company SemiCab, said transportation companies can adjust to higher fuel prices to a point, but ultimately those costs affect nearly everything that moves through commercial supply chains.
“Diesel price has a very, very direct impact on everything that moves on pretty much any mode,” Kapoor said.
The consequences extend beyond freight.
Some public transit buses and trains use diesel, while diesel generators provide emergency or backup electricity in the United States and serve as primary sources of power in some remote areas internationally.
The global strain has intensified as fighting between the United States and Iran escalated again after a period of optimism about a possible peace agreement earlier in the summer.
Brent crude, the international oil benchmark, traded above $95 a barrel Friday, up from roughly $70 before the war began.
Pump prices typically follow crude prices because crude oil is the principal feedstock used to produce diesel and gasoline.
The renewed increase in oil prices follows disruptions to Middle Eastern production and shipping, particularly around the Strait of Hormuz, where much of the region’s crude and petroleum products normally move to world markets.
Tanker traffic through the strategic waterway has been severely constrained during the conflict, adding pressure to global fuel supplies and refined-product inventories.
Neil Atkinson, an energy analyst and senior fellow at the National Center for Energy Analytics, warned that the problem increasingly involves not only prices but also shrinking physical supplies of refined petroleum products.
“This is gradually becoming a major crisis because A) the prices themselves are very high — but the physical stocks of these products are dwindling,” Atkinson said during a weekly briefing with maritime data firm Lloyd’s List Intelligence, referring to mounting pressure on the global refining system.
“This cannot go on forever.”
Countries in Africa and Asia that depend heavily on imported Middle Eastern energy have already experienced some of the most severe effects of the disruption.
The pressure began soon after the United States and Israel launched the war against Iran in late February.
Before the fighting started, diesel averaged approximately $3.76 a gallon nationally, according to AAA.
Regular gasoline averaged about $2.98.
Crude prices rose rapidly after hostilities began as production cuts and shipping disruptions spread through the Middle East.
Diesel consequently increased by more than $2 a gallon between the start of the conflict and Friday, while regular gasoline climbed by more than $1.
Diesel prices also tend to respond more strongly than gasoline during energy shortages because commercial demand is less flexible.
Households can reduce discretionary driving when gasoline becomes expensive, but freight operators have fewer immediate alternatives when goods still need to be transported.
Diesel also plays an unusually broad role in international commerce, increasing competition for available supplies during periods of disruption.
The previous nominal diesel-price record came in June 2022, several months after Russia’s invasion of Ukraine and the imposition of sanctions against Moscow, one of the world’s largest oil producers.
Diesel reached nearly $5.82 a gallon at the time, while gasoline peaked at almost $5.02.
Friday’s $5.85 diesel average is therefore the highest unadjusted price recorded nationally.
When inflation is considered, however, earlier fuel-price spikes were more severe.
Diesel reached approximately $4.74 a gallon before the 2008 financial crisis, equivalent to roughly $7.20 in 2026 dollars according to government inflation data.
The June 2022 peak of nearly $5.82 would equal approximately $6.56 today.
That distinction does little to reduce the immediate burden on businesses and households currently paying the higher nominal prices.
As fuel contracts reset, transportation surcharges increase and companies exhaust their ability to absorb costs internally, a larger portion of the diesel increase could eventually reach consumers.
How severe that effect becomes will depend heavily on the duration of the Iran conflict, the availability of crude and refined petroleum products, and whether tanker traffic through the Strait of Hormuz returns toward normal levels.
For now, record nominal diesel prices are creating a widening economic ripple effect that begins with transportation but extends through groceries, packages, manufacturing, public transit and virtually every commercial supply chain dependent on moving physical goods.
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