Why diesel prices are so high and what it could mean for the cost of living

Diesel is the talk of the town, and for good reason: Prices of diesel fuel are at record highs in the United States, recently reaching an average of $6.53 per gallon. A year ago, they were averaging $3.69 per gallon, meaning they have skyrocketed roughly 77%. While standard, regular unleaded gasoline prices are also sky-high (averaging around $4.50 per gallon), diesel prices have come to dominate the latest news cycle, mostly because they are one of the most important cost inputs in the broader economy. That is, diesel powers many heavy-duty trucks, tractors, ships, and even locomotives, among other things, effectively giving life to some of the largest industries in the world. As such, with diesel prices up, that means overall costs go up, which cascades down into goods and services. In other words: If the cost of fueling up a tractor on a farm increases 77% in a year, the costs of the goods that farm produces are going to increase as well. For industries or businesses that often straddle a very thin line between profit and loss, a significant price hike could be a death knell. And farmers are feeling it. “High diesel prices ARE KILLING FARMERS INCOME,” Senator Chuck Grassley of …