Key facts
- The average price of regular gas in the U.S. was $4.14 per gallon for Labor Day weekend.
- This price is nearly a dollar higher than last year and surpasses the 2012 Labor Day record of $3.82.
- Diesel prices reached a record national average of $5.85 per gallon.
- The increase in fuel prices is linked to the conflict involving Iran and disruptions in oil traffic through the Strait of Hormuz.
- Refinery issues, including high operating capacity and heat-related problems, are contributing to price pressures.
- Ukrainian drone attacks on Russian refineries and declining output from Chinese refiners are also affecting diesel supply.
Fuel prices in the United States have reached a record high for the Labor Day weekend, with the average price of regular gasoline at $4.14 per gallon. This figure is nearly a dollar higher than last year and surpasses the previous Labor Day record of $3.82 set in 2012. Diesel prices have also hit a new national average record of $5.85 per gallon.
The surge in prices is primarily attributed to geopolitical tensions stemming from the conflict involving Iran, which has led to a significant decrease in crude oil traffic through the Strait of Hormuz. Energy finance professor Tom Seng noted that the "Iran War and the Strait of Hormuz" are key factors.
Adding to the price pressure are issues within U.S. refineries, which are operating at 98% capacity and facing challenges such as unusually harsh heat in Texas. Potential problems at these facilities or disruptions from hurricanes could further complicate efforts to lower prices. Furthermore, Ukrainian drone attacks on Russian refineries and declining output from Chinese refiners are squeezing diesel supplies.
Despite the current high prices, Energy Secretary Chris Wright expressed optimism, stating that futures markets forecast lower gasoline prices in the coming months, with bulk gasoline for November being about $0.35 cheaper than current prices. However, he acknowledged that drivers have limited recourse to directly influence these prices.