Diesel Prices Skyrocket by 50% in a Year Amid Global Supply Chain Disruptions

The price of diesel fuel in America has skyrocketed by 50% over the past year, reaching an average of $5.60 per gallon.

This is a major concern for the economy, as diesel is used to power semi-trucks, freight trains, buses, tractors, and tanker trucks that transport goods across the country.

The high price of diesel has significant implications for businesses and municipalities, which are forced to account for this cost directly or indirectly. The impact will be particularly felt during peak harvest time and the holiday shopping season.

Economists attribute the increase in diesel prices to several factors, including international conflicts such as the war between Russia and Ukraine, which has disrupted refined fuel exports from Russia, a major supplier of diesel fuel to the world market. The closure of the Strait of Hormuz due to Iranian missile attacks on oil facilities has also limited global oil supplies.

The U.S. lacks new refinery capacity, having only expanded existing production facilities since the 1970s. This means that there is no easy fix for the diesel price surge and its ripple effects will be felt for many months.