Diesel fuel posts record high in Michigan on Sunday

Michigan set a record for diesel fuel prices Sunday.

AAA reported Sunday afternoon the current average for diesel prices statewide was $6.01 per gallon. This beat the 2022 record of $5.96 per gallon, according to analyst Patrick De Haan of the Dallas-based tech company and fuel price tracker GasBuddy.

Sunday’s diesel average climbed 88 cents from last week and more than a dollar since the beginning of April, according to AAA.

The diesel surge comes as Michigan’s average for regular gas on Sunday topped $4.87 per gallon, 1 cent lower than Saturday’s average. Mid-grade fuel averaged $5.42 per gallon, while premium averaged $4.98 per gallon, according to AAA.

The averages for gasoline all were more than $1.60 higher than they were this time last year, according to AAA. Regular gas was 35 cents cheaper than the record $5.22, posted June 11, 2022.

Diesel prices affect construction, farming and trucking. Higher diesel costs for farming and trucking industries affect food costs, GasBuddy said.

“Higher fuel costs mean higher shipping costs for everything we buy,” according to GasBuddy. “More expensive diesel hits farm budgets and drives up food costs.”

De Haan said Thursday that the price surge was driven by fears that oil shipments will continue to be hampered in the Strait of Hormuz as the United States and Israel wage war with Iran. He said declining gas inventories and the temporary closure of three refineries in Illinois and Indiana earlier in the week contributed to the price surge in Michigan.

De Haan said Sunday’s diesel surge was a “perfect storm” of tight refining capacity, freight demand and global supply disruptions. Diesel inventories are below seasonal norms, meaning the market is vulnerable to refinery outages or shipping delays, Newsweek reported.

Even with the spike, De Haan said Michigan’s gas tax rate that went into effect at the beginning of the year makes the average price lower than if the spike had happened in 2025. Michigan’s 52.4 cents per gallon tax replaced the old 6% state gas tax Jan. 1.

“Diesel prices today are ~13.6c/gal LOWER than they’d have been under Michigan’s old 6% sales tax model prior to this year,” De Haan posted on X Sunday.

Regular gas in Michigan averaged $4.87 in Michigan on Sunday, according to AAA. It was 1 cent lower than Saturday.

De Haan said at that time he didn’t foresee increases as capacity in the Midwest returns to normal after the refinery in Whiting, Indiana, came back online.

mbryan@detroitnews.com