# Market Insights

By [DYLIT Chronicles](https://dylit.info/user/dylitmediabuzz)

[Global Economic Coverage](https://dylit.info/pr/global-economic-coverage/6a6849fd61bb0e07120aa486) > [Market Insights](https://dylit.info/ch/market-insights/6a6849fd61bb0e07120aa48a)

Record $6.51 Diesel Deepens U.S. Supply-Chain Crunch Diesel Hits an All-Time High of $6.51 The U.S. average price for diesel has climbed to a record $6.51 a gallon, AAA reported this week, up sharply from $3.69 a gallon a year earlier. The jump comes as the U.S.-Iran war stretches on with no clear end in sight. Diesel now costs noticeably more than gasoline, a gap that's rippling through nearly every corner of the economy that depends on trucks, trains, and heavy machinery to move goods. What's Driving the Spike The war has choked off crude moving through the Strait of Hormuz. Flows through the waterway have been cut by up to 14 million barrels a day, and Iranian crude exports have collapsed more than 80% from year-earlier levels, squeezing supplies of the crude grades best suited to making diesel. That's pushed crack spreads, the margin refiners earn turning crude into fuel, up to roughly $100 a barrel. Domestic refining capacity has tightened too: two California refineries run by Phillips 66 and Valero recently shut down, cutting the state's total refining capacity by 17.5%. Shipping has taken a hit as well. Houthi attacks in the Red Sea and pirate activity off Somalia have pushed vessels to reroute around Africa, shrinking global shipping capacity by about 15% this year. On top of that, Russia's ban on diesel exports has cut off roughly 12% of the world's seaborne diesel supply. These pressures are hitting the diesel market from nearly every angle at once. 'Worse Than Covid': How Businesses Are Coping Business owners and logistics leaders describe the current moment as harder to manage than the pandemic years. Ravenox CEO Sean Brownlee told CNN the supply chain still works, but with "much more cost, friction and uncertainty than during Covid." Flexport CEO Ryan Petersen, who has spent 25 years in logistics, said he's never seen conditions this volatile. University of Denver supply chain program director Jack Buffington called it "a bigger problem than the pandemic," pointing to the added strain of energy costs on top of everything else. What makes this stretch different is the unpredictability. Covid-era disruptions mostly moved in one direction. This time, prices surge, ease off, then surge again, leaving companies little room to plan more than a few months out. The Toll on Trucking, Freight and Prices Fuel is one of the largest costs in a trucking budget, and the run-up is squeezing carriers and shippers alike. Spot rates for shipping a truckload of goods have climbed to their highest levels in four years, and diesel prices alone explain roughly 46% of the swings in the Producer Price Index for truck transportation. Smaller trucking companies are especially exposed since they lack the fuel surcharges bigger carriers use to offset costs, and some are expected to fold. Coffee distributor Dilworth Coffee has shortened its purchasing horizon from 12 to 24 months down to just 3 to 6 months to manage the swings. Because diesel touches nearly every stage of production and delivery, from farm equipment to delivery vans, researchers estimate that doubling diesel prices could raise food prices by as much as 23.3%, with much of that increase still working its way to store shelves. Why Relief May Be Slow to Arrive Even if the Iran war ends soon, several forces pushing diesel higher aren't tied to the conflict alone. Russia's export ban, the Red Sea rerouting, and extreme weather events are compounding factors that could keep the logistics crisis from easing quickly even after a ceasefire. For now, businesses are absorbing higher costs, passing some along to customers, and bracing for a stretch of instability that, by many accounts, has already outlasted what they saw during the pandemic. Sources NPR — "Diesel, the fuel the U.S. economy runs on, hits record high": https://www.npr.org/2026/09/21/nx-s1-5975468/diesel-the-fuel-the-u-s-economy-runs-on-hits-record-high CNN — "'Crisis even bigger than Covid': American business owners...": https://edition.cnn.com/2026/09/20/economy/covid-diesel-supply-chain Related YouTube videos "Diesel prices surge above $6 a gallon as Iran war drags on" (WQAD News 8): https://www.youtube.com/watch?v=naUcGZIEMRE "Truck drivers facing all-time-high diesel prices amid Iran war" (CBS News): https://www.youtube.com/watch?v=dec_0irfxhM