Diesel Prices Surpass $6 For The First Time [Op-Ed]

Diesel prices have hit another record, with the national average price surpassing $6 on Friday. 

NPR reports that diesel prices are currently $6.05, up from $5.85 last month and significantly higher than the average price of $3.70 this time last year. President Donald Trump promised no new wars and lower prices during his campaign, then turned around and started a new war that increased prices. Fuel prices have been on a roller coaster since Trump began a conflict with Iran in late February. 

The war in Iran has impacted fuel prices for several reasons. One of the most notable has been the uncertainty surrounding the Strait of Hormuz. A large portion of the world’s oil supply is transported through the Strait, which has been subjected to attacks and blockades throughout the war with Iran. While a ceasefire agreement over the summer provided some relief to oil prices, it quickly fell apart, once again leading to conflict around the Strait of Hormuz. 

Iran has also allied with the Houthis, who have carried out proxy attacks on Saudi oil refineries. The war is truly at a stalemate, as the more the U.S. increases its attacks, the more Iran and its proxies begin attacking oil supplies, which in turn has raised prices all across the globe. 

So you might be thinking, “Well, my car doesn’t use diesel. How does this impact me?” 

In a lot of ways, dear reader. 

Diesel trucks are one of the primary ways essential goods are transported in the U.S. Fuel accounts for roughly 15% to 30% of the total cost of food, according to the Independent Grocers Alliance, a grouping of 7,500 global supermarkets. This is because perishable foods like meat and produce need constant restocking. Not to mention, the food is likely harvested using farm equipment that runs on diesel fuel. 

David Ortega, a professor of food economics and policy at Michigan State University, said that food that needs to be refrigerated is usually the first to see price increases during spikes like these.

“Early on, much of the cost increase gets absorbed along the supply chain through existing freight contracts and retailer margins,” Ortega told NPR. “But as contracts reprice and fuel surcharges take hold, more of that cost makes its way to the grocery store.”

Beyond food, rising diesel prices will likely affect online shopping. Several digital retailers have already begun passing the costs on to consumers through added online fees and delivery costs. 

From NPR:

Back in April, e-commerce giant Amazon rolled out a temporary 3.5% fuel and logistics surcharge on some third-party sellers. United Parcel Service, FedEx and the United States Postal Service also moved to add fees on some of the packages they ship earlier in the war, citing rising costs for fuel overall.

Experts warn that price hikes could mount the longer diesel remains expensive. A range of other products are also transported by diesel-powered networks, including clothing, cosmetics and furniture.

The ramifications extend beyond consumer goods. Some public transit buses and trains also run on diesel. And diesel generators are often used for backup or emergency power, if not central electricity sources in some remote parts of the world.

Groceries are already so expensive that more and more people are going into debt to pay for them. The continued rise in fuel prices won’t help ease that pressure. Prices at the pump for regular gas aren’t doing too much better. The average price for fuel is $4.29 nationwide, up from $3.15 last year. 

An unpopular war that’s driving price hikes on nearly all essential goods isn’t a good look for Republicans heading into the midterms. Maybe Trump should focus more on wrapping up the conflict in Iran than trying to bribe voters. 

SEE ALSO:

Inflation Hit Highest 1 Month Spike In 4 Years Due To Iran War

Gas Prices Over $4/Gal. In All 50 States. Trump Says It’s ‘Peanuts’