Diesel hits record $5.98 a gallon as diesel cracks top $100 a barrel
Diesel set an all-time high this week, a national average of $5.98 a gallon, and the benchmark behind most fuel surcharges hit a record at the same time. For haulers, surcharges reset higher on the next load. For jobbers, every delivery now carries more margin exposure and more credit risk, because the dollar value of a full truck just went up and so did the odds a customer pays late.
The move under the headline is diesel pulling away from gasoline at the refinery. The benchmark 3-2-1 crack edged up just $0.52 last week to $66.36 a barrel, but the diesel crack alone pushed above $100 a barrel, a record, per RBN. Refiners are making far more on a barrel of diesel than on gasoline right now, which tells you where the refining barrel is going and why pump diesel is running ahead of pump gas.
Oil above $100
Brent was trading at $101.04 and WTI at $96.09 as the US-Iran tanker fight escalated in the Persian Gulf and the Gulf of Oman. The US said it hit ten Iranian tankers; Iran reported hits on US warships and tankers. That crude is still being produced, so the problem is moving it, not finding it.
Tanker rates hit record highs as operators reroute to avoid the Strait of Hormuz, and that freight cost rides on every barrel that does move. The EIA raised its oil price forecasts on the Middle East disruptions. Separately, Russia's Ryazan refinery, about 350,000 barrels a day, has been offline since a September 6 drone strike, pulling product supply off the global board at the worst time.
Gasoline at $4.28
The national gasoline average jumped 6 cents overnight to $4.28 a gallon. GasBuddy's Patrick De Haan noted the usual seasonal setup should be pushing prices down right now, with summer demand fading and the switch to cheaper winter-spec gasoline due within a week. His read: if the US and Iran keep trading attacks, operators may not see much relief at the pump until the geopolitics improve. So the calendar says lower, the Gulf says higher, and the Gulf is winning this week.
C-store foodservice
One thing working in operators' favor while fuel margins swing: foodservice keeps gaining with younger customers, and the gap between c-stores and quick-service restaurants narrows each year, per CStore Decisions. When fuel margin is unpredictable, inside sales and prepared food are the part of the P&L an operator can actually steer. Worth leaning on the kitchen while the street price does what it wants.
What to watch
Whether the Strait of Hormuz stays open is the whole crude question; crude could ease if traffic normalizes and could stay bid if the tanker attacks continue. Watch the diesel crack specifically, not just the 3-2-1 headline, because that is what sets your surcharge and your delivered cost. The OPEC monthly report is due, which may shift the supply picture. And keep an eye on whether the winter-gasoline switch pulls the pump gas average down even with crude above $100, or whether the Gulf overrides the season again.