Diesel Prices Surge to $5/Gallon Again: Iran War and Refinery Crisis

U.S. diesel prices have once again surpassed $5 per gallon, driven by renewed fighting in the Persian Gulf and a refinery capacity crisis. This marks the second time in three months the price has hit this level, with a 33% increase since the start of the Iran war. The Energy Information Administration (EIA) projects further increases, with diesel prices potentially rising another 15% this year. The Department of Commerce's decision to raise diesel prices has proven insufficient as refinery outages continue. Markets are now pricing in a 20% long-term increase in diesel prices, given the ongoing conflict between Iran and Houthi rebels.