Global Energy Disruptions Send Diesel Prices Soaring

The national average on-highway diesel price has reached $6.285 per gallon, up from $5.97 the week before and over $2.50 from the same time last year, an increase of nearly 70%.

This surge is due to several disruptions in global energy markets, including the closure of the Strait of Hormuz, attacks on infrastructure by Houthi rebels in the Bab al-Mandab Strait, and limited refining capacity in Russia.

Farmers are particularly affected as diesel prices rise during harvest season when equipment use is high. Diesel is exempt from the 24.4-cent-per-gallon federal highway fuel tax but still sees a sharp increase. The average farm diesel price reached $5.45 per gallon on Sept. 4, up from $3.02 a year earlier, an increase of about 80%.

The USDA forecasts farm fuel and oil expenses at approximately $22 billion in 2026, up nearly 29%, or almost $5 billion, from 2025. Despite increased grain prices, farmers are expected to operate below breakeven once again.