Diesel futures top $5 a gallon for first time since 2022, pressuring c-store pump margins

Diesel futures topped $5 a gallon on Sept. 10, the first time since April 2022. New York diesel traded as high as $5.03, the equivalent of about $210 a barrel. For any c-store operator who sells diesel off the forecourt, that is a margin problem before it is anything else.

Retail diesel lags the wholesale board. When futures move this fast, the pump price can't keep up, and the operator absorbs the gap on every gallon until the street catches up. The move is coming from supply, not demand: Ukrainian drone strikes have pushed Moscow to ban exports, and Middle East tension around the Strait of Hormuz threatens more disruption. Both squeeze the global diesel pool that sets the price at your rack.

California's $9.999 pumps

Some California diesel pumps hit $9.999 a gallon this week, according to GasBuddy, while the national board set new highs. For operators in the state, the surge tests how far you can pass wholesale through before diesel volume falls off and the fuel customer stops walking inside. Foodservice and the rest of the basket carry more of the store when the pump stops paying.

Gaskins joins OXXO

Derek Gaskins is back in convenience. He joined OXXO USA as vice president of marketing and category management, weeks after announcing in early August that he was leaving the channel for Mars-owned Hotel Chocolat. Gaskins has run marketing and category work at GetGo, Rutter's, Yesway and bp, so this is a serious hire for a chain still finding its footing here.

OXXO is the Mexican chain owned by FEMSA. It entered the US in August 2024 when FEMSA bought Delek's retail arm for $385 million, picking up 249 stores concentrated across the Southwest. Since then the work has been rebranding and folding those former Delek sites into the OXXO network. Bringing in an operator with Gaskins' category background says the chain wants to compete on the inside of the store, not just hold the corners it bought.

What to watch

Watch how fast street diesel closes the gap to the wholesale board. The longer futures stay near $5, the thinner forecourt margins run for anyone who didn't lock supply. Watch California specifically, where the pump number is already near ten dollars and diesel demand could soften if it holds. And watch what OXXO does with Gaskins in the chair. A first real category and marketing push across those 249 stores would tell you whether FEMSA plans to grow the US footprint or just run what it bought.