{"id":332504,"date":"2026-03-10T23:57:09","date_gmt":"2026-03-10T23:57:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/332504\/"},"modified":"2026-03-10T23:57:09","modified_gmt":"2026-03-10T23:57:09","slug":"soaring-fuel-prices-to-cast-long-shadow-across-us-economy","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/332504\/","title":{"rendered":"Soaring fuel prices to cast long shadow across US economy"},"content":{"rendered":"

The US energy department has warned petrol and diesel prices are unlikely to recede to prewar levels until mid-2027 at the earliest, ratcheting up costs for industries from trucking and farming to airlines and retailers.<\/p>\n

Official figures released on Tuesday show US petrol prices rose 19 per cent over the past two weeks to $3.50 a gallon as the Middle East conflict<\/a> throttled energy supplies, while diesel jumped 28 per cent to $4.86 a gallon.<\/p>\n

Petrol is not forecast to drop back below its $2.94 per gallon pre-conflict level before the end of 2027, according to the Energy Information Administration, the energy department\u2019s statistics arm. Diesel \u2014 the lifeblood of American industry \u2014 will not fall below the $3.81 per gallon it sat at two weeks ago until the middle of next year. <\/p>\n

The shift threatens to push up costs for industry, which in turn will ratchet up prices for consumers with far-reaching inflationary impacts for the world\u2019s largest economy. <\/p>\n

It will also pile pressure on Donald Trump, who campaigned for the presidency in 2024 on a platform to slash petrol and energy costs. Prices at the pump are now higher than at any time during his two terms in office.<\/p>\n

\u201cWe\u2019ve got a lot of costs moving their way through the system,\u201d said Tom Kloza, an independent oil analyst. \u201cWe\u2019re looking at some really scary inflation ratings \u2014 pervasive inflation<\/a> throughout the country.\u201d<\/p>\n

The rise in the price of refined fuel products in the US comes as Iran\u2019s threats to strike ships traversing the Strait of Hormuz have all but halted maritime traffic in an artery through which roughly a fifth of global oil<\/a> supply flows.<\/p>\n

That has prompted crude prices to surge, with West Texas Intermediate, the US benchmark, rising from $61 a barrel before the conflict started to a peak of almost $120 in intraday trading on Monday before falling back. The US benchmark fell 11.9 per cent to $83.45 on Tuesday. <\/p>\n

\"Line<\/p>\n

But the impact on fuel prices is set to endure, with sweeping implications for American business and consumers.<\/p>\n

The trucking industry, among the most exposed to diesel price fluctuations, said companies would pass much of the increase on to consumers.<\/p>\n

\u201cHigher diesel costs\u2009.\u2009.\u2009.\u2009remain one of the trucking industry\u2019s largest expenses,\u201d said Bob Costello, chief economist at the American Trucking Associations. \u201cLuckily, most carriers have fuel surcharges so they recoup much, although generally not all, of those expenses from their customers.\u201d<\/p>\n

Brian Wanner, owner of trucking group Peters Brothers, said there was \u201cno way\u201d his business could survive without the surcharge.<\/p>\n

\u201cMargins are slim in this industry and trucking has been struggling for the past three years, so if you\u2019re not protected it\u2019s not good,\u201d said Wanner, whose business uses more than 1mn gallons of fuel a year.<\/p>\n

For farmers, the rise in fuel costs comes just as the industry prepares to plant corn and soyabeans \u2014 important inputs to the food, livestock and biofuels industries.<\/p>\n

\u201cFarmers [are] facing increased volatility in fertiliser and fuel prices as well as some reports of companies freezing fertiliser sales,\u201d said Zippy Duvall, president of the American Farm Bureau Federation.<\/p>\n

In the US, diesel accounts for a relatively small part of a farmer\u2019s budget, said Gary Schnitkey, professor of farm management at the University of Illinois, but it will feed through to other costs given its use to run farm equipment and haul crops.<\/p>\n

\u201cSo transportation costs and the costs of other products will go up.\u00a0It will cause another round of inflation in input prices,\u201d Schnitkey said.<\/p>\n

Other industries will also be affected as companies with fleets of vehicles deal with the impact of higher petrol and diesel prices.<\/p>\n

Bill Fehrman, chief executive of American Electric Power, one of the largest US utilities, said his company\u2019s response team had pinpointed its large fleet of vehicles as the biggest risk.<\/p>\n

\u201cWe\u2019ll go through about 10mn gallons of fuel a year, trucks and various other equipment that we have to have to service our customers,\u201d he said. \u201cSo basically, for every 10 cents change in fuel costs, it\u2019s a million dollars\u2009.\u2009.\u2009.\u2009on average over a year.\u201d<\/p>\n

Meanwhile, retailers are exposed to higher fuel costs directly through their logistics networks and indirectly by the squeeze it places on the disposable income of some consumers.<\/p>\n

Chains with stores spread across far-flung rural areas were particularly exposed, said Simeon Gutman, a retail analyst at Morgan Stanley. \u201cPretty soon, there\u2019s probably going to be some pullback\u201d in spending, particularly among middle and lower-income consumers, he said.<\/p>\n

Other refined products have also surged in price. Jet fuel rose almost 60 per cent to $3.95 a gallon in the days after the US and Israeli military strikes, according to the Argus US Jet Fuel Index, falling back to $3.67 on Monday.<\/p>\n

With fuel costs accounting for roughly a quarter of operating costs under normal market conditions, United Airlines CEO Scott Kirby last week said the increases would have a \u201cmeaningful\u201d impact on the carrier\u2019s first-quarter results, warning that the impact on ticket prices would \u201cprobably start quick\u201d.<\/p>\n

Dan Akins, an aviation economist with Flightpath Economics, said that while airlines were \u201cworried about subsidising travel for people who bought tickets when fuel prices were low\u201d, they were also wary of sharp ticket price increases leading to demand destruction.<\/p>\n

Shares in the Detroit carmakers also fell this week amid concerns that higher petrol prices would hit demand for trucks and SUVs. <\/p>\n

Recommended<\/p>\n

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The rise in prices at the pump will affect consumers more directly, with studies suggesting poor Americans will be hit hardest.<\/p>\n

\u201cThe pain at the pump is not evenly distributed,\u201d said Stephanie Valdez Streaty, director of industry insights at Cox Automotive. \u201cLower\u2011income households spend a disproportionate share of their budgets on fuel and have the least financial cushion to absorb higher costs.\u201d<\/p>\n

Analysts said the ultimate impact of the price rise would depend on the length of the conflict and any further escalation \u2014 factors industry would be monitoring closely. <\/p>\n

\u201cDuration matters,\u201d said Joe Brusuelas, chief economist at RSM. <\/p>\n","protected":false},"excerpt":{"rendered":"The US energy department has warned petrol and diesel prices are unlikely to recede to prewar levels until…\n","protected":false},"author":2,"featured_media":332505,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[114,184,85,46],"class_list":{"0":"post-332504","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-il","11":"tag-israel"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/332504","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=332504"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/332504\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/332505"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=332504"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=332504"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=332504"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}