Diesel Prices May Remain High for Years, Experts Warn

Kansas State University agricultural economist Gregg Ibendahl warns that diesel prices may remain high for at least another year, squeezing farmers' profit margins and eventually impacting consumers.

Diesel fuel prices have surged to $2.25 per gallon higher than earlier this year, with the largest driver being a global shortage of diesel fuel, rather than crude oil prices.

Ibendahl explains that U.S. refineries are operating at near-capacity, but global supplies have tightened due to geopolitical disruptions, including reduced shipments from Russia and curtailed flows through key shipping routes such as the Gulf region.

Farmers are particularly affected, as they cannot pass on higher diesel costs directly, and the added fuel costs can make a significant difference in their bottom line. For example, an extra $10 per acre in fuel costs alone can add up to $20,000 for a farmer working 2,000 acres.