War in the Middle East pushes diesel prices up — other costs will likely follow

One very specific economic impact of war in the Middle East: Diesel fuel just topped $4 a gallon. It’s the first time it’s been that high in nearly two years, and it’s likely to get even more expensive.

Even if you don’t drive a diesel truck, this price spike is going to hit you, too.

The cost of diesel is spiking way higher than crude oil. Morgan Bazilian at the Colorado School of Mines said that’s because “[the] crude oil that comes from the Middle East is … a little easier to get gasoline and diesel from than other types of oil.”

The U.S. uses diesel primarily for manufacturing and freight. So, the cost of moving anything will go up, Bazilian said.

Prices for airline tickets will go up almost immediately — the price of jet fuel is spiking, too.

Whether the price of other goods goes up depends on where you get them from.

“If you buy something from Amazon, say, … because they’re big … they have negotiated shipping rates with UPS, the US Postal Service,” said Hugh Daigle, a professor of petroleum engineering at The University of Texas at Austin.

Daigle said those shippers will eat the extra diesel cost til they renegotiate, which could be months from now.

“What's really going to be affected is if you're just mailing something to somebody else, or buying something from a small mom and pop business or something like that,” he said.

It’s tough to say just how much those prices will go up. If Iran completely halts ship traffic in the Strait of Hormuz, it could be a lot.