By WYATTE GRANTHAM-PHILIPS

CHICAGO (AP) — Diesel hit a new record price in the U.S. on Friday, soaring to an average of $5.85 a gallon for the first time ever as the six-month war with Iran disrupts the world’s flow of fuel.

Because diesel is used for many freight and delivery networks, higher diesel prices mean higher transportation costs for a long list of everyday goods. More expensive fuel is increasing bills for businesses across sectors — some of which have already passed off costs to consumers in the form of added fees on online orders and packages in the mail. And shoppers may see more and more sticker shock trickle into store shelves.

The increases could have political implications, with economic issues likely to be top of mind for many voters in November’s midterm elections.

One of the most immediate strains falls in the grocery aisle, particularly with produce, meat and other perishable foods that need to be hauled in and restocked frequently — or even harvested using diesel-powered farm equipment. It can take time for all of those costs to trickle down.

Still, experts warn that price hikes could mount the longer diesel remains expensive. A range of other products are also transported by diesel trucks, trains and boats, including clothing, cosmetics, furniture and more.

The price for regular gasoline has also been going up, although not as fast as the price of diesel. The average price was $4.15 a gallon, compared with $3.20 at this time last year, according to AAA.

What’s driving the latest jump for diesel

Before the U.S. and Israel launched their war against Iran in late February, the national average for a gallon of diesel was about $3.76 in the U.S., per AAA. Prices quickly climbed as the cost of crude oil — the main ingredient in diesel, as well as gasoline — soared amid supply chain disruptions and production cuts across the Middle East, notably with most tanker traffic bottlenecked in the key Strait of Hormuz.

Despite prices cooling some during hopes for peace earlier in the summer, oil has now renewed its climb as fighting once more escalates between the U.S. and Iran. Brent crude, the international standard, was trading at more than $95 a barrel Friday, up from roughly $70 before the war. Prices at the pump always follow closely behind.

The last time U.S. businesses and drivers saw sky-high fuel prices was in June 2022, when diesel reached as high as nearly $5.82 a gallon on average, months after the Ukraine war began and world leaders imposed sanctions against Russia, a leading oil producer.

When adjusted for inflation, however, prices have been higher in the past. Ahead of the 2008 financial crisis, for example, diesel peaked at about $4.74 a gallon — equivalent to $7.20 in 2026, according to the government’s latest data. And 2022’s record of nearly $5.82 would be about $6.56 this year when accounting for inflation.

That doesn’t take the pain away from today’s steep prices, which are already bringing ripple effects for the economy and wider costs of living. Drivers are feeling the pain each time they fill up gasoline, too.

The average $4.15 for a gallon of regular unleaded is up from $2.98 before the Iran war, although still well below the 2022 peak of nearly $5.02 a gallon nationwide.

Diesel has been more expensive than gasoline for decades, and its price has risen at a faster pace during recent energy crises. Some reasons include more limited supply, less flexibility in demand, and diesel’s position in global commerce overall. Individual households may find ways to drive less when gas prices are high, for example, but there’s fewer immediate substitutes for networks that rely on diesel to help produce and haul goods worldwide.

All eyes on food

Diesel is integral to every part of the food supply chain. It powers farm equipment and fishing boats as well as the trains, cargo ships and trucks that get food to grocery stores.

Fuel accounts for roughly 15% to 30% of the total cost of food, according to the Independent Grocers Alliance, a grouping of 7,500 global supermarkets. Because of this, higher diesel costs often result in more expensive food, although it can take a while for energy shocks to wind their way through the supply chain.

Items that need to stay refrigerated while they’re transported are often the first to see prices rise, according to David Ortega, a professor of food economics and policy at Michigan State University. In July, for example, overall U.S. grocery prices were up 2.7% compared to last July, but seafood prices were up 7% and fresh fruit prices were up 4.9%.

Ortega cautioned that there can be other factors at play when food prices go up or down. Lettuce also faced higher transportation costs in July, but a drop in demand due to the cyclospora outbreak caused prices to fall.

Still, consumers could feel more of a squeeze the longer diesel prices remain high.

“Early on, much of the cost increase gets absorbed along the supply chain through existing freight contracts and retailer margins,” Ortega said. “But as contracts reprice and fuel surcharges take hold, more of that cost makes its way to the grocery store.”

More fuel shocks

Back in April, e-commerce giant Amazon rolled out a temporary 3.5% fuel and logistics surcharge on some third-party sellers. And United Parcel Service, FedEx and the United States Postal Service also moved to add fees on some of the packages they ship earlier in the war, citing rising operational costs for fuel overall.

Ajesh Kapoor, CEO and founder of trucking technology company SemiCab, said trucking and transportations can adapt to rising diesel prices — but at some point there is a limit.

“Diesel price has a very, very direct impact on everything that moves on pretty much any mode,” Kapoor said.

Balboa Park is well known for its major arts institutions.

But those institutions and arts organizations across San Diego County are struggling with funding in recent years.

It has led to layoffs at both the San Diego Museum of Art (SDMA) and the Institute of Contemporary Art San Diego (ICA) over the past few months.

“I didn’t know it would end like this when I first started,” said former ICA visitor experience representative Dianna Elizardo.

They were among the ICA staff who were let go between late July and mid-August. ICA’s management announced they reduced its staff by 42% last month.

“I think it really boils down to financial challenges which I really think comes down to financial mismanagement,” said former ICA Curator Jordan Karney Chaim.

Karney Chaim and Elizardo spoke to KPBS outside the ICA’s Balboa Park campus Wednesday. They stood alongside their other former colleagues, Sarah Trujillo-Porter and Katrina Land.

The ICA board of directors said there were previously 21 staff members across their two campuses in Encinitas and San Diego.

The organization formed in spring 2021 when the San Diego Art Institute and the Lux Art Institute announced their merger.

“Every year our resources dwindled. The exhibition budget was cut in half nearly every year since I started,” Karney Chaim said.

The four former ICA employees said they are part of the group called “Current and Former Staff of the Institute of Contemporary Art San Diego.”

That group sent an email to KPBS alleging financial mismanagement left the ICA “unable to meet payroll, maintain staffing, or sustain its public-facing operations.”

They provided documentation pointing to the organization’s Form 990 tax filings.

KPBS reviewed those forms and saw there was a $221,000 budget deficit in 2023. It more than doubled in 2024 to over $448,000.

“We really wanted to make sure that someone is being held accountable whether that’s the board of directors or the … executive director,” former ICA Director of Operations Trujillo-Porter said.

ICA made other recent changes due to its financial situation.

The organization temporarily closed its central Balboa Park campus to the general public. That means exhibitions like Cat Gunn’s ‘if only by the light of a new moon’ ended weeks earlier than planned, and other planned exhibitions for this year will not happen.

ICA executive director Andrew Utt was not available for comment.

The ICA Board provided KPBS a statement addressing an Aug. 18 letter from current staff expressing “no confidence” in Utt’s leadership.

That letter called for an urgent leadership transition and a formal audit of the most recent fiscal year.

“We have engaged outside counsel and begun a review of our finances and governance,” the ICA Board statement said in part. “The board takes the concerns raised seriously and is not commenting further while the review is underway. We expect to be in a position to share more later this month.”

Just across Balboa Park’s Plaza de Panama, the SDMA recently cut its workforce too.

They laid off 11 staff members in August. Their staff now sits at 118 employees.

“… the difficult decision by the board of trustees was deemed necessary in the face of the ongoing funding downturn,” said SDMA’s Chief Operating Officer Kari Kovach in a statement.

She said SDMA is not alone in this challenging arts funding environment.

“Similar reductions have become necessary across a broad swath of arts organizations and museums in the U.S. as institutions adjust to new realities,” Kovach said. “SDMA is confident in its ability to continue operating successfully and to remain financially secure.”

For now, the group of former ICA staff said they’re reassessing their careers and job hunting.

They said with arts funding shortfalls in recent years, it’s time to reimagine how to build a lasting ecosystem for the arts in San Diego.

“We need to be thinking about people who are the foundation — and that’s artists, that’s art workers and the spaces that are open every day to the public free of charge that are keeping art in San Diego,” Karney Chaim said.

San Diego is done waiting for Mexico to fix its sewage nightmare.

County supervisors voted this week to pursue a new sewage treatment system on the US side of the border, aiming to stop polluted water from the Tijuana River before it reaches San Diego communities and beaches.

The plan, spearheaded by Supervisors Paloma Aguirre and Terra Lawson-Remer, would be developed in three phases, with the county spending $1.8 million to study potential treatment systems over the next year and a half.

“We’ll keep working with Washington and Mexico, but we will set the pace and we won’t wait on anyone else’s timeline,” Aguirre said of Tuesday’s vote.

The need is painfully visible — and sometimes downright nauseating.

Millions of gallons of sewage-contaminated water can pour across the border, foul the Tijuana River and ultimately wash into the Pacific. Beach closures have reached as far north as Coronado, one of San Diego’s most popular seaside destinations.

Video posted by TV personality Chef Andrew Gruel previously showed murky yellow-green water washing onto Coronado’s normally packed summer beach.

“This is Coronado currently,” it read. “High tourist season. High heat of summer. No beach access.”

The pollution isn’t just an eyesore. Researchers have found that sewage-related contaminants can become airborne, while hydrogen sulfide — the gas notorious for its rotten-egg smell — has reached 4,500 times higher than typical urban levels near one South Bay hotspot.

County officials have even offered eligible households free air purifiers to help residents deal with odors and reduce exposure to the gas, according to NBC.

The new system would provide another line of defense after existing treatment and diversion infrastructure fails to capture everything.

“After 60 years, that is the gap that has no solution: the U.S. side of the Tijuana River is not treated at all,” Aguirre and Lawson-Remer said in a county board letter.

Download The California Post App, follow us on social, and subscribe to our newsletters

“Once sewage and toxic runoff are in the river, nothing protects our coastlines and communities from the impacts.”

Supervisor Joel Anderson cast the lone vote against the plan, warning the project could become a multibillion-dollar undertaking.

“That could lead to billions,” he said. “The county just doesn’t have that kind of money. And it shouldn’t be the county’s responsibility. The state and the feds and everybody else should be involved.”

Supervisor Jim Desmond agreed that Mexico ultimately needs to solve the problem, saying he wants to “see Mexico stand up and fix this issue,” but added that San Diego should “at least plan for the worst-case scenario.”

Aguirre, whose district includes communities impacted by the pollution, said residents have heard promises for decades.

“After 60 years of promises regarding the issue, the skepticism in my community is not just understandable, it has been earned,” NBC reported.

Lawson-Remer put it more bluntly: “The time has come to end this environmental injustice.”