Latest News Updates From Will Kubzansky

For businesses that rely on diesel, increased fuel costs are cutting revenue and forcing business owners to raise prices, as energy-driven inflation flows downstream.

Higher futures prices for diesel, seen as the workhorse of the global economy, typically ripple through to the pump and stoke inflation.

Global diesel supplies have faced severe constraints since the U.S. and Israel first attacked Iran in late February.

U.S. diesel supplies have fallen to the lowest seasonal mark ever, threatening to push prices even higher for the global economy’s workhorse fuel.

Refineries processed 17.4 million barrels of crude oil on a daily basis last week, according to EIA. That surpassed any point since September 2019.

A near-perfect storm of factors has coalesced to raise prices, threatening a winter of higher heating bills and inflationary shocks.

The global scramble for diesel is increasingly draining U.S. supplies. Exports of distillate fuel rose to 1.9 million barrels a day last week, according to data released by the EIA.

U.S. refiners are turning crude oil into gasoline and diesel at a pace not seen since before the pandemic, but even that is unlikely to rein in soaring prices.

Refiners are on track to produce the most diesel the U.S. has ever made in the month of July, and one of the highest months on record outside of winter heating season.

Average pump prices stood at $3.98 a gallon as of July 16, according to data from the American Automobile Association — up nearly 20 cents in just 10 days.