US diesel hits record $6.50 amid deepening global fuel crunch

The average retail price of diesel in the United States has climbed to a record $6.5050 per gallon as of Sunday, according to data from AAA. This represents a significant jump of approximately $1 per gallon over the past four weeks, surpassing previous records and moving past $6 a gallon for the first time. The surge is attributed to constrained fuel supply from the Middle East and Russia, coupled with Brent crude oil remaining at $100 per barrel.

Consequently, U.S. gasoline prices are also on the rise, now averaging $4.4761 per gallon, up from $4.1044 a month ago and $3.1894 a year ago. These price spikes could influence voter behavior in the upcoming mid-term elections and potentially worsen inflation and slow economic growth. Goldman Sachs has revised its 12-month recession risk estimate down to 15% from 30% in March, citing resilient global and U.S. economies despite supply disruptions, though the firm noted this could increase with another shock.