Diesel prices spiked more than 60¢ combined on Monday and Tuesday.
It is a direct result of the supply cutoff through the Strait of Hormuz, says Alex Hodes, director of market strategy – energy with StoneX Financial Inc. Refined product movement is concentrated in the Strait, making this one of the biggest global disruptions for the oil market.
“A large amount of refined products, specifically diesel and jet fuel, transport through this Strait. That closure is causing panic in buyers of Middle Eastern diesel, one of which is Europe, which is kind of the primary maker of diesel prices globally. That’s dragging on NYMEX heating oil diesel prices as well,” Hodes says.
Nationwide Diesel Prices Up Sharply from 2025
After rising 10.8¢/gal. on Monday, the national average price of diesel rose another 8.1¢ Tuesday afternoon. It reached $3.929/gal. — a rise of almost 20¢ in two days, writes Patrick DeHaan, head of petroleum analysis at GasBuddy, in a post on X.
Data from the Energy Information Administration (EIA) shows the national average diesel price on Tuesday was up 31¢/gal. from a year ago.
Meanwhile on Wednesday morning, NYMEX heating oil futures were up nearly 68¢ from Friday at $3.26/gal. Diesel prices are based on these futures.
When compared to a year ago, NYMEX heating oil prices were up over 90¢/gal. and have risen $1.21 since December 31.
They Could Climb Higher
Hodes thinks there is more upside potential for diesel fuel prices.
“Yes, I think there’s still risks that are in the market and have not really come to fruition quite yet. So ultimately, with the Strait of Hormuz closure, the question will be how long will that last,” Hodes says.
Some relief may come following a Tuesday afternoon post from President Donald Trump. He ordered the U.S. Development Finance Corporation to provide political risk insurance and guarantees for the financial security of all maritime trade at a reasonable price. He added that, if necessary, the U.S. Navy would escort tankers through the Strait.
While that will help lower the insurance costs to allow oil tankers to pass through the Strait, the shipping industry sees this as only a partial solution to the historic crisis.
“One other factor is that several Middle Eastern refineries have been attacked, and that’s over 1 million barrels per day almost offline due to those attacks. So, additional Middle Eastern refineries could be at risk, and that’s another bullish factor there,” Hodes says.
Diesel Prices Rise More Than Other Energy Products
He adds diesel has risen disproportionately more than other energy products. This is partly due to tighter global inventories.
“But the biggest one is that there’s more diesel products flowing through the Strait of Hormuz than gasoline or some of the lighter counterparts,” Hodes says.
And Asian refineries, particularly in Japan and China, have also announced they could reduce run rates at their refineries if the disruption lasts.
The Price Hike Comes at Crunch Time for Farmers
The higher prices come as diesel demand ramps up for planting.
“It is a tough time to lock in fuel costs specifically, you know, in the start of March now. So, it’s not a great time to be a consumer of fuel,” Hodes says.
Unfortunately, few farmers locked in diesel prices when they hit lows in December and early January. This was just before the polar vortex rallied prices.
It is another expense they can’t afford when farmers are moving into the 2026 growing season already facing slim-to-negative profit margins.
