4 minPolitics
Diesel price surge complicates Trump housing affordability push
A sharp rise in diesel prices, driven by the Iran war, is adding new pressure on home builders and complicating President Trump's promise to lower housing costs ahead of the midterm elections.
A sharp increase in diesel prices is emerging as a new obstacle to President Donald Trump's housing affordability agenda, as war-driven energy costs ripple through the construction industry. With midterm elections approaching, the surge underscores the political tension facing Trump and congressional Republicans who have pledged to bring down housing costs while energy prices add fresh pressure to home building.
Diesel powers the trucks and heavy equipment used throughout the construction process, from hauling lumber and concrete to preparing lots and building new homes. The national average price of on-highway diesel climbed to $5.65 a gallon this week, up nearly $2.00 from a year ago, according to data compiled by the Energy Information Administration. That year-over-year increase is far sharper than gasoline's, with the national average for regular gas at about $4.09 a gallon.
Jim Tobin, president and CEO of the National Association of Home Builders (NAHB), said diesel is critical to construction. "Diesel, which our workers use when they're hauling materials on trucks and moving dirt on sites, has seen a spike, and that has really put a little bit of pressure on home building in the short term here," Tobin told Fox News Digital.
The added pressure comes as Trump has made housing affordability a key part of his second-term agenda. In March, he signed an executive order directing federal agencies to reduce regulatory barriers that raise construction and homeownership costs, with an emphasis on speeding permitting and expanding supply. Builders are already wrestling with expensive financing, labor, materials, and costs tied to regulations and permitting that Republicans have pledged to reduce.
Even as the administration targets regulatory costs, builders say other expenses can quickly offset those savings. Tobin said the industry has so far seen only a modest impact from tariffs on construction inputs, but he has begun hearing from manufacturers announcing price increases, particularly those tied to steel and aluminum costs. Diesel adds another layer of pressure by raising the cost of both getting materials to a job site and completing the work once they arrive.
The issue is especially significant in fast-growing states across the South and Southwest, where an influx of residents, businesses, and capital has fueled demand for new housing. "States that find themselves ahead of the curve are planning those two critical components, infrastructure and housing, together," Tobin said. "They're going to be better prepared for growth in the future."
Builders are also grappling with a persistent shortage of construction workers. Tobin said the industry is roughly 250,000 workers short, raising labor costs and contributing to project delays. More homes are needed to ease price pressures, but each increase in the cost of labor, land, materials, financing, or fuel makes that task harder.
Diesel may not appear on a buyer's closing documents, but its cost can still be felt long before they get the keys. The White House did not immediately respond to a request for comment.
