Gas prices surge just before Labor Day, as diesel nears record high

Gasoline prices are on the rise ahead of the Labor Day holiday, with the AAA predicting record-high pump prices for travelers. The national average for regular gasoline reached $4.14 per gallon on Thursday, a 4-cent increase from the previous week, according to AAA data. Diesel fuel averaged $5.78 per gallon, just below its June 2022 record of $5.81. Historically, gas prices have never surpassed $4 per gallon on Labor Day, the motor club noted.

Despite typically lower demand in the fall, this year's high fuel costs are an exception due to the current price of crude oil. AAA attributes this to ongoing conflict in the Strait of Hormuz, which has pushed diesel prices near a record high. Since the start of the Iran war, higher gas and diesel prices have cost American households over $741 each, according to a Brown University tracker.

The surge in diesel costs is affecting various industries reliant on heavy-duty vehicles and machinery, such as trucking, construction, and agriculture. High diesel prices can also contribute to inflation by increasing transportation costs, which in turn raises consumer prices for goods like groceries and fruits. President Trump recently met with U.S. oil refiners to discuss increasing capacity and signed a deal with Venezuela to secure about 65 billion barrels of its oil reserves, but experts warn that it could take years for these fields to impact fuel prices in the U.S. Oil prices have continued to rise as Iran recently targeted U.S. forces in the Middle East, with Brent crude reaching $95.55 per barrel and U.S. benchmark at $91.50.