Drivers in the United States are currently paying an average of $5.85 per gallon for diesel, marking the highest price recorded to date. This figure represents an increase from $3.71 a year ago and surpasses the previous peak following Russia's invasion of Ukraine, according to the American Automobile Association (AAA). The rise in diesel prices is attributed to the ongoing conflict involving the US and Israel with Iran, which has impacted wholesale oil prices since February.
Diesel is primarily utilized by commercial vehicles, including trucks, trains, boats, buses, farming, and construction vehicles. In response to the escalating fuel costs, former President Donald Trump has proposed an oil deal with Venezuela aimed at reducing gas prices for Americans. This deal, announced recently, involves the development of 17 strategic oil fields in Venezuela, which are estimated to contain 65 billion barrels of oil, along with an investment exceeding $100 billion and over $209 billion in taxes, as stated by Interim Venezuelan President Delcy Rodríguez.
The US government is expected to maintain a 55% stake in a joint venture with a private operator in Venezuela, as reported by a US official to CBS News. However, some analysts have expressed skepticism regarding the effectiveness of this deal in overcoming persistent challenges that have hindered investment in Venezuela's oil sector.
The conflict has also led to limited oil supplies, particularly as Iran has restricted access to the Strait of Hormuz, a critical passage for global oil transport. Rising fuel prices have prompted dissatisfaction among US voters ahead of the midterm elections in November, with recent polling from Reuters/Ipsos indicating that Trump's approval rating has dropped to 33%, and only 31% of Americans support the ongoing conflict.
The impact of rising diesel prices is not uniform across the country; for instance, residents in Western states are experiencing significantly higher prices due to tax variations and distance from oil producers. In Washington, for example, diesel prices average $6.81 per gallon, compared to $5.03 a year ago. Additionally, petrol prices have also reached historic highs, with the average price per gallon at $4.15, up from $3.20 a year prior.