We’ve got some good news and some bad news for diesel drivers in California, along with anyone who buys any goods that travel by ship, truck, or train. Diesel fuel in parts of California can’t get any more expensive than it is right now.
It’s not because of some sort of price cap or relief, though. The limiting factor is… more technical than that. If you were hunkered down on December 31, 1999, this all might seem a bit familiar.
Prices Are Too High For Even Gas Stations
Signs and pumps at filling stations are almost universally limited to three digits. The price can go from $0.00 to $9.99 per gallon, but once the price hits $10, the digital displays just won’t do it.
Now, at least one station in San Diego has hit that figure. A Shell station was charging $9.99 per gallon for diesel fuel, Bloomberg reports, and it might not be the only one.
The sign limit hasn’t been a problem, because nobody thought prices would ever get that high. At least not in the near future. But thanks to the ongoing quagmire with Iran and the Strait of Hormuz, diesel has blown through all-time records.
Right now, the national average price for a gallon of diesel is $6.294 according to data from AAA. That’s more than 40 cents higher than it has ever been before this run, and nearly $3 a gallon more than a year ago.
In California, the average price for a gallon of diesel is $8.21, 90 cents above the next-highest state. So an urban station asking for a premium over that and reaching the $10 mark isn’t really a surprise. A look at GasBuddy reviews of the station suggests that it has been priced higher than average for many years.
One station is getting all the attention, but it’s certainly not the first and probably not the only one. It’s probably also not going to be the last one to hit $9.99, either, as the situation hasn’t gotten any better in the last few days.
How Can A Gas Station Solve This Y2K-Style Problem?
Kenworth W900 semi trucksKenworth
What is a station to do when the price it charges is higher than the pumps and signs allow? Expect massive fuel price cuts, but not in the way you’re hoping for.
Fuel prices have broken through common sign limits before. States normally demand that fuel is sold by the gallon, but there have been plenty of exceptions for reasons like this.
During the 2022 record highs, for example, states including Arkansas allowed retailers to sell fuel in half-gallon increments. That could mean you see a $6 on the sign and even at the pump, but that’s the price for a half-gallon of fuel. The full gallon price, then, would be $12.
Those measures were generally temporary. They also required clear signage on the pump to avoid confusion. Modern pumps may be capable of charging higher prices even if the price screen above the handle can’t display them.
CarBuzz Insight – Why This Matters:
2013 Volkswagen XL1 rear quarter while movingVolkswagen
Diesel has now become more expensive than station builders ever expected. It’s not showing any signs of retreating, either, with heating season in the Northern Hemisphere about to start, record low reserves of crude and diesel, and continued attacks on oil supply infrastructure and refining capacity.
All drivers can do is hold on. It might be time to get rid of that lift kit and 37-inch mud tires, though. The impacts of this will trickle down to nearly every product bought, sold, or consumed in the world, and the trickle is starting to look like a flood.
Sources: Bloomberg, AAA
