Drivers in the US are paying more than ever for diesel at the pump as the US-Israel war with Iran continues to impact fuel costs. The average price for one gallon of diesel in the US has reached $5.85, surpassing previous highs set after Russia's invasion of Ukraine, where prices were $3.71 per gallon. This surge mirrors the rise in wholesale oil prices due to the Iran conflict, which began at the end of February.
President Donald Trump recently announced an oil deal with Venezuela, aiming to substantially lower gas prices for Americans. The agreement involves developing 17 strategic oil fields with a potential of 65 billion barrels, along with investments exceeding $100 billion (£73.9 billion) and $209 billion in taxes for Venezuela. The US government retains 55% control of a joint venture with a private operator. However, analysts question whether this deal will address long-standing investment barriers in Venezuela's oil industry.
Oil prices are influenced by Iran's response to the war, including the closure of the Strait of Hormuz, a critical oil shipping route. This has led to increased pump prices, particularly in Western US states due to tax differences and proximity to oil producers. For example, Washington's average diesel price is $6.81 per gallon, up from $5.03 a year ago. Petrol prices have also risen, reaching $4.15 per gallon, up from $3.20 a year ago.
The rising fuel costs have sparked political backlash ahead of the November midterm elections. Recent polling shows Trump's approval rating at 33%, with 31% of Americans approving the conflict. While some Americans face higher prices, regional variations exist due to tax structures and distance from oil production areas.
Source: BBC
