Ricardo Guerrero arrives in the Loop every day around 5:30 a.m. to run his three food trucks, all serving authentic Mexican food.
The Cicero resident has been in the food truck business for five years. But this year has been unexpectedly difficult.
The rising price of diesel fuel, and even gasoline, has forced Guerrero to spend hundreds of dollars more per week in order to continue serving tourists and Chicagoans outside The Art Institute of Chicago and Shedd Aquarium.
While most consumers can find ways to cut back on gas, it’s harder to escape the impact of diesel’s record-breaking prices because it shows up in other ways.
“People have been focusing on gas prices because that’s what hits them [at the pump]. But diesel affects all of us as well because almost everything that you eat, drink, use in your daily life has been on a truck or a rail car at some point,” Dana Regan, vice president of business development at TranzAct Technologies, a transportation management company, said.
Diesel prices in Illinois and the Chicago area hit an all-time high less than three months after the U.S.-Israel war with Iran began in February.
The average cost of diesel in the Chicago metro area reached a record $6.30 a gallon on May 15. Illinois diesel prices also smashed through its record that day, hitting $6.14 a gallon, according GasBuddy.
The new highs toppled the last records from June 2022, a few months after Russia invaded Ukraine. At the time, the Chicago-area’s diesel price was $5.89.
Nationally, the average diesel price on Thursday was $5.64 a gallon, 19 cents below the June 2022 record of $5.83.
Blocking the Strait of Hormuz
Fuel prices have been climbing following Iran’s control of the Strait of Hormuz, a narrow waterway between the Persian Gulf and the Gulf of Oman. Twenty percent of the world’s oil supply passes through the Strait, but Iran has essentially closed off access, with the average number of ships passing through daily dropping by 95%, according to the UN Conference on Trade and Development.
President Donald Trump said Thursday that he was against Iran’s plan to charge fees for passage through the Strait. “We want it open. We want it free. We don’t want tolls,” he said to reporters at the White House. “It’s an international waterway.”
Trump on Monday had threatened further attacks on Iran’s capital but pulled back, saying it was at the request of Gulf allies.
The Strait’s closure has caused the largest disruption the oil industry has ever faced, according to Sam Ori, executive director of the University of Chicago’s Institute for Climate and Sustainable Growth.
Michael Mahler, chief operating officer of HMD Trucking in Chicago Ridge, said the company’s bottom line has worsened because of higher diesel prices, but it’s also motivated the company to move quicker on its long-term strategy.
“From a day-to-day operations standpoint, we are regularly analyzing routes to identify more affordable states for fueling along those routes, as well as eliminating or changing some routes altogether,” Mahler said in a statement. “On a larger scale, the current and historical instability in fuel prices has significantly expedited our renewable energy strategy. We will aggressively add Tesla EV Semis later this year to better protect us from diesel fuel instability in the coming years.”
The price of diesel in the Chicago metro area has increased by 71% year over year, according to GasBuddy. Last May, diesel was $3.63.
While the average gas price rose higher than $5 for the first time since 2022, diesel prices will likely impact consumers and business owners the most, experts say.
Guerrero said he typically spends about $500 every five days to fill up his three food trucks — two run on gas and the third needs diesel. Now, it costs him over $800.
In brighter times, he had planned to add three more Caseras Sabor Real food trucks, “but I would sell those trucks just to reinvest back in the three I already have,” he said.
Guerrero, 54, has been building up his savings over the years, but now he fears he’ll need to dip into the account to keep operations running.
Diesel’s impact on consumer prices
“Diesel is what really powers the U.S. economy. From trains to tractors and trucks, diesel is the fuel that brings everything. If you look around you, everything is in your office or in your home because of diesel,” Patrick De Haan, petroleum analyst at GasBuddy, said.”Supply chains up and down are powered by diesel.”
The transportation, shipping, farming and logistics industry run on diesel, and the jump in price will lead to more inflation for consumers already struggling with the rising living costs, according to Rachel Bronson, senior fellow on energy and geopolitics at the Chicago Council on Global Affairs.
Guerrero is already feeling the impact. He’s paying about 35% more for the ingredients in his well-loved quesabirria, or birria tacos, and its smoothies. The price of meat and produce, like lettuce and tomatoes, have also increased. He’s worked out a line of credit with some suppliers, which allows him to pay the following month.
Guerrero and his wife also run Caseras Sabor Real Restaurant in Maywood. While the eatery has suffered from rising costs, its worse for his food trucks, he said.
He hasn’t missed payroll for his 15 food truck employees, but several times, he recently didn’t have enough funds to also pay himself.
He raised the trucks’ food prices by about 10% since the war began, but he doesn’t want to increase prices further.
“[I] stress too much due to the fact that [I] want to give out a good price, but once [my] prices go up, it’s like, I don’t know what to do,” Guerrero said.
He estimates he could keep up operating a seven day schedule for five more months.
“The number one [impact] will be food prices, due to the price of fertilizer,” Phillip Braun, professor at Northwestern University, said. “It’s going to be affected either by higher fertilizer cost or lower [harvests] because of the fertilizer cost.”
Crude oil is commonly used in fertilizer. The Green Markets Weekly North America Fertilizer Price Index reported Wednesday that the cost of fertilizer increased 30% year over year.
An American Farm Bureau Federation survey in April among 5,700 farmers found that 48% in the Midwest reported the greatest difficulty in securing fertilizer. Meanwhile, other regions reported a much harder time finding enough fertilizer. The bureau also said farm diesel prices — “a major operating expense during spring planting” — have risen 46% since the end of February.
Bronson said the increases in fertilizer and transportation costs show up in grocery aisles.
She said oranges, for example, imported to the U.S. will cost more because of higher transportation costs. That will mean shoppers are going to be charged more for oranges down the line or it will lead stores to carry less oranges, she said.
The spike in transportation fuel acts as a hidden tax on delivered goods.
‘Did not budget’
Transportation and logistics companies were not prepared for a strain like this, Regan said.
“The biggest thing is people did not budget [for] a significant increase in transportation costs,” she said. “They prepare their 2026 budgets in 2025, and I don’t think anyone saw this coming. [Companies] have to pass the costs on downstream. It’s going to eventually affect the consumer.”
Bronson said shipping, often the cheapest way to transport goods, is also an industry facing headwinds, with companies adding fuel surcharges.
The U.S. Postal Service announced in March an 8% price increase on all packages, which started April 26 and runs through Jan. 27, 2027.
“Transportation costs have been increasing, and our competitors have reacted with a number of surcharges,” the Postal Service said in news release. “We have steadfastly avoided surcharges and this charge is less than one-third of what our competitors charge for fuel alone.”
FedEx has a 27.25% surcharge in place for ground, home delivery, international ground and pick up services. The surcharge rate is 25.2% higher than its rates before the war. And its rates are updated weekly according to national diesel fuel prices, FedEx said.
UPS told its customers that starting May 18, it was adding an extra 27.75% fee on top of typical shipping costs on domestic ground packages.
“We’re feeling it in terms of price at the pump, but we’re really feeling it in terms of inflationary pressure that this energy crisis is causing for the everyday American,” Bronson said. “It’s probably the greatest concern for our economy right now.”
If the Strait were to open, the inflationary impact won’t go away, and prices aren’t likely to drop soon, Bronson said.
She said the unpredictability of the situation paired with “very little visibility and transparency” from leaders creates an unstable market.
“Even if the Strait of Hormuz [is] open tomorrow, the infrastructure has been hit,” she said. “It takes time to put the energy back onto the market. … It’s already been damaged.”