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By Hugh Cameron
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As the unfolding Iran war drives up global oil prices, new data shows diesel prices climbing toward a two‑year peak.
The national average price of diesel hit $4.00 per gallon on Wednesday for the first time since April 24, 2024, according to Patrick De Haan, head of petroleum analysis at GasBuddy.
Separate GasBuddy figures show regular gas prices continuing to climb further above the $3 mark and themselves nearing a one-year high, while Barchart data shows that gasoline futures contracts are closing in on their own two-year high—signaling that markets expect wholesale prices to continue on their upward trend for the next few weeks.
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Why It Matters
Fuel prices and the wider issue of affordability into which they feed have emerged as a national political flashpoint, intensifying scrutiny of President Donald Trump’s administration, but also shaping recent electoral outcomes across the U.S.
The latest strikes on Iran, and Tehran’s broad retaliation strategy, have roiled global oil markets and threatened both production and supply, promising to push up pump prices depending on how prolonged these tensions prove to be.
What To Know
According to the latest data from AAA, accurate as of early Thursday morning, diesel prices now stand at $4.17 per gallon. This marks a sharp increase from $3.66 this time last year, but remains well below the highest ever average of $5.82, recorded in the summer of 2022 following Russia’s full-scale invasion of Ukraine.
This comes on the heels of a sharp uptick in global oil prices, which analysts say typically drip into retail costs over the course of days and weeks.
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Brent crude is currently trading at around $83 per barrel, and analysts warn that this could soar to over $100, a level not reached since 2022, if U.S. efforts to reverse Iran’s disruption of shipping in the Strait of Hormuz fail. Beyond the disruptions to this crucial passage, through which around a fifth of global oil supply flows, production is now also being impacted by Iranian strikes across the Gulf, forcing several refineries to halt operations following repeated drone attacks.
"The global oil market now faces a situation where critical energy infrastructure in the Middle East is being hit directly at the same time as traffic through the Strait of Hormuz has ground to a halt," Torbjorn Soltvedt, principal Middle East analyst at Verisk Maplecroft, told Newsweek.
"Unless the U.S. and Israel can suppress Iran’s ability to launch drones and missiles, prices are likely to climb further."
What People Are Saying
Torbjorn Soltvedt, of the global risk and strategic consulting firm Verisk Maplecroft, told Newsweek: "The impact on oil supply so far has been mitigated by front-loaded exports by major Gulf producers as part of efforts to get ahead of any conflict-related disruption. But the impact of this will wane over the coming weeks.
"If Iranian attacks against Gulf energy infrastructure and the threat to shipping persist over the next two weeks, the impact will be far greater, and $100 per barrel becomes a realistic prospect."
President Donald Trump, speaking at a press conference on Wednesday, said: "We’re doing very well on the war front, to put it mildly, I would say. Somebody said, 'On a scale of 10 where would you rate it?' I said, 'About a 15.'"
What Happens Next
In addition to the impact on gas and diesel, analysts at Goldman Sachs have predicted that the rally in oil prices could drive up inflation at home well into the year.
On Wednesday, Treasury Secretary Scott Bessent said the administration was preparing to make a "series of announcements" regarding how the U.S. could prop up supply flows in the region.
Earlier in the week, Trump announced that the U.S. Development Finance Corporation (DFC) would "provide, at a very reasonable price, political risk insurance and guarantees" for all maritime trade in the Gulf, and that, if necessary, the U.S. Navy would "begin escorting tankers through the Strait of Hormuz."
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