HOUSTON — Why could the soaring price of diesel drive up the price of almost everything we buy?
While the price of regular gas remains up compared to a year ago, the price of diesel is hovering around $5 a gallon.
A year ago the national average of a gallon of diesel was just over $3 a gallon. According to the New York Times part of the reason for the high price is the war in Ukraine. Russia is a big exporter of diesel and the crude oil used to make it.
Diesel passenger vehicles have never been as popular in the U.S. as places like Europe, but that doesn’t mean you won’t pay the price.
Farming equipment like tractors and combines rely on diesel to produce our food. Manufacturers use it in factories to make our goods. The trucks that transport food and goods use it to get those products to stores. Those increases are eventually passed on to consumers.
In fact some reports says one-tenth of the inflation we have seen in the past year is a result of diesel prices.
So when will we some relief?
The price of diesel may be getting so high that demand is dropping since some companies are just not able to cover the cost.
Also some refineries in North America are switching over to produce diesel, while new ones are expected to come online next year. But that relief may be too slow for people and businesses that depend on diesel.