The Trump administration is concerned about the record rise in diesel fuel prices in America. The average cost of diesel in the country has reached $5.85 per gallon, significantly higher than the previous figure of $3.76 per gallon. Thus, over the past few months, the price of diesel in the USA has increased by approximately 55%.
In this regard, the price increase attracted the attention of American President Donald Trump, who addressed Ukrainian President Volodymyr Zelensky. Trump called on Zelensky to stop attacks on oil refinery and diesel production facilities in Russia. The American president stated that he discussed the problem of diesel shortage with Volodymyr Zelensky, insisting that Zelensky should cease shelling Russian diesel facilities.
According to Trump, constant attacks from Ukraine negatively affect diesel supplies to Russia, which in turn affects the global fuel market. At the same time, Trump denies that the main reason for the increase in diesel prices in the USA is the war with Iran.
During the summer, Ukraine struck more than twenty oil refineries and oil-related facilities in Russia. Russian President Vladimir Putin acknowledged that these attacks are putting pressure on the Russian economy. As of September 7, Ukraine attacked Russia's energy infrastructure. Volodymyr Zelensky justified these strikes as a response to Russian attacks on Ukraine. Following Ukrainian attacks, Russia imposed restrictions on diesel exports at the end of September, which heightened concerns about diesel supplies on the international market.
Trump asserts that the current surge in diesel prices in the USA is due to the Russian-Ukrainian conflict, not the war with Iran. Nevertheless, Trump previously spoke about the link between the war with Iran and rising fuel prices. After the start of military actions between the US and Israel against Iran on February 28, the price of diesel in America rose by approximately 55%. During the Middle East conflict, tanker traffic and oil supplies were disrupted.
Obstacles in the Strait of Hormuz particularly impacted the global oil market. On the international market, benchmark Brent traded above $107 per barrel on September 14, whereas before the war, the price of crude oil was around $70 per barrel. The rise in crude oil prices directly affects the cost of diesel fuel and gasoline.
In the USA, diesel fuel is used not only in trucks and buses. A significant part of the country's supply chain depends on diesel: large trucks, delivery vehicles, rail transport, and many industrial machines run on diesel fuel. Diesel also plays a major role in American agriculture, as farmers use it for tractors and other agricultural equipment. Consequently, the increase in diesel costs affects not only gas stations but also increases costs in agriculture, transportation, and production. This means that prolonged high diesel prices could lead to an increase in the cost of consumer goods such as food, clothing, furniture, and cosmetics, as well as an increase in the cost of online orders.
The USA faces a dual problem: rising fuel prices and increased political pressure on the Trump administration regarding inflation and the war with Iran. Inflation in the USA has already risen after the implementation of Trump's tariff policies and the start of the war with Iran. The probability of further inflation growth increases due to accelerating diesel prices. If diesel prices remain high for a long time, it could affect the entire US economy. Expensive fuel could become an important issue for American voters ahead of the midterm elections in November, creating additional pressure on the Trump administration.
One of the reasons for the increase in diesel prices in the USA is the low level of inventory reserves. By the end of August, fuel reserves were at an extremely low level for this time of year. The situation on the US East Coast is even more critical, where diesel and heating oil reserves have reached record lows. Pressure may intensify in the coming months. With the start of winter, farmers will use more diesel for harvesting, and demand for heating fuel will increase even before the cold sets in. Although American refineries are trying to increase production, their production capacities have reached multi-year highs, and the international market is not receiving sufficient fuel due to processing problems elsewhere in the world and supply shortages.