The most liked comment on last Thursday's diesel post was about the refining margin. So we took a gallon apart with EIA's numbers.
Short version...most of it is the refining spread, not the oil. Of the 2.63 a gallon diesel went up, 84 cents is the oil and 1.68 is the spread. The last 11 cents is everything after the refinery.
The Board
- Diesel, EIA weekly survey...6.382 for 9/28, up from 3.754 a year earlier
- Diesel, AAA national today...6.389, off the 6.528 record set 9/22
- Brent...102.31, up 4.4% Thursday on the December contract
- WTI...92.87, November contract, Thursday settle
The Gallon, Taken Apart
EIA prices on the last Monday of September, 2025 against 2026:
- Crude...WTI spot at Cushing went from 64.27 to 99.37 a barrel. Divide by 42 gallons and that's 84 cents more per gallon
- Wholesale diesel...New York Harbor went from 2.392 to 4.910, up 2.52
- Refining spread...wholesale minus crude went from 86 cents to 2.54, up 1.68
- Everything after the refinery, the truck, the terminal, the station and the tax...up 11 cents
That's our math off EIA's spot prices and pump survey, not an official EIA breakdown. Gulf Coast wholesale and other September dates tell the same story, and EIA's own monthly breakdown, through May, has refining as the biggest jump too.
We used WTI because what US refiners actually pay for crude runs within a few dollars of it, per EIA. Spot WTI ran about 7 dollars over the futures price Monday and Tuesday, which is why it reads higher than the board.
What The Spread Is
It's a gross number. Wholesale diesel minus crude, before the plant pays for labor, power, turnarounds or anything else.
RBN Energy figures about 15 dollars a barrel of it, roughly 36 cents a gallon, goes to federal renewable fuel compliance. The NYMEX diesel crack hit a record 113.48 a barrel on 9/16, per RBN.
Why It's This Wide
Diesel trades at a world price, and right now there isn't enough to go around.
- Chinese refiners suspended October fuel exports, Reuters reported Thursday
- Russia extended its diesel export ban for producers through Oct 31. Resellers stay barred through January
- Middle East crude is back near prewar flows, per CNBC. Fuel shipments from the region are still constrained
- US refineries went from 96.8% of capacity to 92.5% in the 2 weeks to 9/25, heading into fall maintenance season, per EIA
So a shortage overseas lands on the pump in Williston and Midland.
What Washington Can Touch
- Taxes...24.4 cents federal plus about 35.5 cents average state, per the Farm Bureau. A federal holiday is worth 24.4 cents at most, and Penn Wharton figures about 15 cents of that would reach the pump
- Export limits...these go after the spread. Some in Congress want diesel exports paused. The Energy Secretary and refiner groups say tanks would fill and plants would cut runs. S&P Global figured a full ban could cut US refinery runs by nearly 1.9 million barrels a day
- Neither a tax holiday nor an export limit goes after the crude price. Thursday it moved on the war. Brent jumped 4.4% after a Wall Street Journal report that a 3rd US carrier group is headed to the Middle East
- As of Thursday night nothing was signed. Reuters reported Thursday the US told France and Germany to release emergency diesel stocks or face a US export ban. EU officials meet Friday
What It Means On Location
Every hotshot, crude hauler and diesel frac fleet pays the diesel price, and most of what got added this year sits in the spread, not the barrel.
A service company answering the Dallas Fed survey this week wrote "Diesel prices continue to erode margins."
An operator wrote "I don't quite understand why the price is high at the pump. The U.S. has plenty of supply."
The gallon above is the answer.
Where It Goes From Here
EIA forecast in September that diesel stocks stay below their 2021-2025 low through the end of 2026 and most of 2027.
Dates to watch...Europe's stock decision, China's next export call, Russia's producer ban running out Oct 31, OPEC+ on Sunday.
Who's Hiring
Outfits are hiring in North Dakota, Wyoming and Texas, including seats that need no CDL.
The current board is the one to check.
Field Report
Drop your town or basin, what you paid for diesel this week, and whether it was on-road or red dye.