U.S. diesel prices jump to $5.13 per gallon amid Iran conflict, raising transport costs

Diesel prices in the United States have risen sharply, reaching $5.13 per gallon, up from an average of $3.56 in January, according to the Energy Information Administration. The increase follows heightened tensions in the Middle East that have limited shipments through the Strait of Hormuz, a key global oil transit point.

The higher fuel cost is expected to affect a wide range of sectors that rely on diesel, including trucking, agriculture, freight rail and construction equipment. A fully loaded semi-truck, which typically gets six to seven miles per gallon, now faces fuel expenses of more than $1,280 for a full tank.

"We all focus on gasoline because, ultimately, we're consumers and pump prices are very visible. But what we don't think about is the price of diesel, which is the workhorse fuel for the U.S. economy and especially for key sectors," said Bernard Yaros, lead U.S. economist for Oxford Economics.

"From an inflationary perspective, I'm very concerned about the recent rise in diesel prices as it pertains to the cost of food or grocery store prices," Yaros added, noting that diesel powers irrigation pumps, farm tractors and the trucks that deliver food to stores.

An industry source, who asked to remain anonymous, linked the price surge directly to the conflict in Iran and the resulting closure of the Strait of Hormuz, which moves roughly 20 million barrels of oil daily. The source explained that refinery lag times mean that even if crude oil prices stabilize, the higher diesel costs could persist for weeks.

Analysts warn that the ripple effect may keep grocery and delivery prices elevated for some time, even after the geopolitical situation eases.