Why Diesel Prices Are So Much Higher Than Gasoline

There was a time when diesel fuel was usually cheaper than gasoline in the United States. That relationship began to change about 20 years ago, and since then diesel has generally traded at a premium. Today, that premium is not just persistent but unusually large, which raises an obvious question: how did we get from gasoline typically costing more than diesel to diesel costing substantially more than gasoline?

The answer has two parts. The first is structural and goes back to the mid-2000s, when changes in fuel specifications, taxes, refining…