NEW DELHI: Diesel hit a record price in the US on September 4, soaring to an average of $5.85 a gallon for the first time as the six-month war with Iran disrupts the world’s flow of fuel.
Higher diesel prices mean higher transportation costs for a long list of everyday goods. Some businesses have already passed on costs to consumers in the form of added fees on online orders and packages in the mail.
One of the most immediate strains is being felt in the grocery aisle, particularly with produce, meat and other perishable foods that need to be hauled in and restocked frequently — or even harvested using diesel-powered farm equipment. It can take time for all of those costs to trickle down.
A range of other products are also transported by diesel trucks, trains and boats, including clothing, cosmetics and furniture. This could add to Republicans’ political challenges ahead of November’s midterm elections, with many voters already sour on President Donald Trump’s management of the economy and fallout of the war he launched.
AP-NORC polling this summer showed 2 out of 3 US adults disapproved of how Trump is handling the economy.
The price for regular gasoline has also been going up, although not as fast as the price of diesel. The average price was $4.15 a gallon, compared with $3.20 at this time last year, according to motor club AAA, which says gas has never been above $4 a gallon on Labor Day.
Bottleneck at Strait
American diesel prices are now nearly 56 per cent more expensive than they were before the US and Israel launched their war against Iran in late February, when the national average sat at about $3.76 per gallon per AAA.
Prices quickly climbed as the cost of crude oil — the main ingredient in diesel, as well as gasoline — soared amid supply chain disruptions across the Middle East, notably with most tanker traffic bottlenecked in the key Strait of Hormuz.
