California diesel averages $7.98 as refiners reach capacity
The U.S. national average price for diesel fuel crossed $6 per gallon for the first time on Friday, reaching $6.06, UPI reported, citing AAA. The new high surpasses the previous record of $5.82, set in June 2022.
The milestone follows a sustained climb in diesel prices that has tracked the war in Iran since the United States and Israel launched strikes on Iran in February. Diesel prices are up 55% since the strikes began, UPI reported, putting 2026 on pace to record the largest annual percentage increase on record.
The Iran war, combined with the war between Russia and Ukraine, has removed roughly 8% of global diesel supply from the market, UPI reported. Refiners have responded by maximizing output, with little additional capacity left to draw on.
“Refiners have already been maximizing the production of diesel,” Andy Lipow, president of Lipow Oil Associates, told CNN. “We simply can’t get any more diesel out of the system.”
Diesel powers much of the U.S. freight and supply-chain network. Sustained increases in the fuel’s price typically pass through to other sectors of the economy, including groceries and consumer goods, UPI reported.
Gasoline prices have climbed alongside diesel. The national average for regular-grade gasoline reached $4.29 per gallon on Friday, UPI reported — a 40% increase and the highest price ever recorded for gasoline this late in the year, since retail prices typically peak in the summer driving season.
State-level variation in diesel prices remains significant. California posted the highest average diesel price in the country on Friday, at $7.98 per gallon, up from $5.16 a year earlier, UPI reported.
Crude oil futures rose as the war in Iran again intensified. Brent crude, the international benchmark, traded at about $104 per barrel on Friday morning. West Texas Intermediate crude, the U.S. benchmark, was nearing the $100 mark at about $99.07, UPI reported.