Prices jump as wars bite

The national average for gasoline jumped seven cents overnight to four dollars forty-four a gallon on Thursday, up nearly fifty percent since the Iran war started in February.

Diesel hits record high

Diesel, essential for transporting food and goods around the U.S., hit a record six dollars forty a gallon, up seventy-seven cents since the beginning of September.

Expert warns of sustained pain

Patrick De Haan, a petroleum expert at GasBuddy, projects gas could hit four dollars fifty a gallon later this week and diesel could hit six dollars sixty as early as this weekend.

“Consumers should plan on higher prices for longer.”

Diesel inflation will ripple

Tom Kloza, chief energy adviser for Gulf Oil, warns that high diesel prices will increase utility bills and heating costs. Around four million Northeast households rely on heating oil made from diesel.

“Buckle up and recognize that inflation is likely to get turbocharged by these high prices for a product you probably don't care much about, which is diesel fuel.”

Three wars squeeze supply

Ongoing fighting in the Iran war, Russia-Ukraine war and Red Sea attacks by Iran-backed Houthi rebels have crimped global oil supply. Brent crude, the global benchmark, traded around one hundred three dollars a barrel Thursday.

“It's the two wars, which now look like the three.”

Refining capacity collapses

Houthi attacks on the East-West pipeline in Saudi Arabia cut four million barrels per day from the global market, according to Eurasia Group. Ukrainian drone strikes on Russian oil infrastructure have knocked out an estimated three million barrels of refining capacity.

Some states pay far more

Gas prices in Illinois averaged four dollars seventy-eight a gallon on Thursday, more than thirty cents above the national average. California drivers pay more than six dollars a gallon on average for gas.

Regional refining gaps widen

Tom Kloza notes the West Coast, which already has limited refining facilities, is feeling the pinch of higher prices. Blue states tend to be more expensive while red states tend to be cheaper based on where energy and refining are located.

“Blue states tend to be more expensive. Red states tend to be cheaper, and that has a lot to do with where the energy is and where the refining is.”