The American Soybean Association Sends Letter to Trump
(Seoul = Yonhap News) Reporter Moon Gwan-hyeon = Diesel prices in the U.S. have surged by 37% over the past month, nearing $5 per gallon (approximately 3.78 liters or about 7,500 won), reported the Financial Times (FT) on the 16th (local time).
According to the American Automobile Association (AAA), the average retail price of diesel in the U.S. increased to $4.99 per gallon on this day, a 37% surge compared to a month ago. FT noted that this is the highest level since Russia’s invasion of Ukraine in 2022.
The international oil price is fluctuating due to Iran effectively blockading the Strait of Hormuz, a key oil shipping route, in response to attacks from the U.S. and Israel.
There are observations that the surge in diesel prices could drive up costs from freight transportation to crop cultivation, potentially impacting consumer price levels across the U.S.
FT’s analysis suggests that President Donald Trump, dealing with what is called an ‘affordability crisis’, might face the risk of chain consumer cost increases across the country.
Affordability refers to the expenditure capacity that consumers can handle. Price stabilization has emerged as a major issue in U.S. politics ahead of the midterm elections.
Ed Hirs, an energy economist at the University of Houston, noted that diesel prices tend to spike and then gradually decrease, adding, “The only thing the (Trump) administration can do is end this war.”
Kareem Miller, CEO of the small transportation company Strong Fact Trucking, stated that the rise in diesel prices is already a burden. He told FT, “It will push up the prices of groceries, building materials, and everything else.”
The surge in diesel prices coincides with the spring sowing season, potentially increasing the burden on farmers since diesel is essential for operating farm machinery and transporting livestock.
According to the U.S. Department of Agriculture, American farms spent nearly $10 billion on diesel in 2024, accounting for 2% of their total expenditures.
The American Soybean Association sent a letter to President Trump stating that “farmers are paying more than ever to cultivate crops,” FT reported.
The association mentioned that even before the blockade of the Strait of Hormuz, input costs had increased between 15% to up to 95% over the past five years, varying by item, and had risen further since the blockade.