U.S. on-highway diesel averaged $6.199 per gallon as of October 5, about $1.85 above regular gasoline. Oilprice.com's Robert Rapier attributes the gap to a structural premium and to a tight global distillate market in 2026.
As of October 5, the national average price of on-highway diesel was $6.199 per gallon, compared with $4.354 for regular gasoline. That is a spread of about $1.85 per gallon. Diesel reached a nominal record of $6.29 per gallon in September, according to EIA.
A structural premium dating to 2004
Diesel has not always cost more. According to the Energy Information Administration, on-highway diesel prices have been higher than regular gasoline almost continuously since September 2004.
The shift coincided with a requirement for U.S. refiners to dramatically reduce the sulfur content of highway diesel. Rapier writes that this made diesel more expensive to produce, and that EIA also cites strong global demand and federal taxes six cents per gallon higher on diesel than on gasoline.
Tight global supply widens the gap
The size of today's spread comes from a more immediate problem. EIA recently reported that global distillate supplies are tight because of reduced refining activity in Russia, China, and the Middle East.
U.S. refiners are not the weak link. Domestic distillate production averaged about 5.1 million barrels per day through August, the highest level since 2019. But exports increased, and by mid-September distillate inventories were about 13% below the five-year seasonal average.
Rapier adds that the situation has tightened since then. Russia has restricted diesel exports as refinery infrastructure has been damaged, and China has curtailed fuel exports to protect domestic supplies. Tanker costs and insurance rates have also risen.
Margins follow the shortage
Refining margins have risen sharply, and Rapier argues they are a consequence of constrained diesel supply rather than the original cause of the shortage. In his view, scarcity comes first and refiners that keep producing benefit from it.
He concludes that abundant U.S. crude does not guarantee cheap diesel, and that diesel is likely to remain much more expensive than gasoline until the supply constraints ease.
Source: Oilprice.com
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