If Record-High Gas and Diesel Prices Trigger a Stock Market Crash, History Says Investors Should Follow This 1 Piece of Warren Buffett Advice

Gasoline and diesel prices are hitting record highs across the U.S., and they're still climbing.

According to auto club AAA, Monday's national average price of regular gasoline was $4.48/gallon. Not only is that up from last week's average of $4.32/gallon, but it's the highest average regular gas price ever recorded in September.

At least regular gas prices are still below their all-time record high of $5.01/gallon, set in June 2022. But diesel prices have broken their historic records. The current national average for a gallon of diesel fuel is $6.51, a new all-time high.

That's a big problem for the economy, and it could even be big enough to trigger a market crash. But if it does, legendary investor Warren Buffett has one big piece of advice that all investors should heed.

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Why high diesel prices could cause a serious economic shock

Because diesel fuel is used so widely by commercial trucks, freight trains, construction machinery, and farm equipment, high diesel prices affect the cost of many other goods and services throughout the economy. And unlike gasoline, which often gets cheaper in the autumn as gas stations switch to cheaper "winter blend" fuel, the cold-weather version of diesel fuel is actually more expensive with reduced fuel economy. Also, home heating oil demand rises in the fall, and it is made from the same type of oil as diesel.

So although oil prices have receded a bit from last week's highs, gas and diesel prices are expected to continue to rise. That's partly because most gasoline is delivered to filling stations by tanker trucks. And what do those trucks run on? Diesel.

During the first half of September, the major stock market indexes tumbled, in part over concerns about fuel costs. The S&P 500 (SNPINDEX: ^GSPC) was down 1.3%, and the Dow Jones Industrial Average (DJINDICES: ^DJI) fell 2.1%.

But if exploding diesel prices trigger a deeper economic downturn or even a market crash, what should investors do?

That's where the wisdom of Warren Buffett comes in.

Image source: Getty Images.

Buffett's perfect advice for a stock market crash

Warren Buffett is no stranger to market crashes. As the longtime CEO and Chairman of Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB), Buffett was a stock market investor during the Great Recession, the dot-com bust, and even "Black Monday" 1987, the largest percentage one-day market drop in history.

But instead of pulling his money out of the market during those downturns, Buffett stayed invested. If anything, he bought more stocks at bargain prices. His reason was simple, and he summed it up in just 12 words: "Be fearful when others are greedy. Be greedy when others are fearful."

Research by the Motley Fool bolsters Buffett's advice. It shows that investors who remain invested during market downturns (the "greedy") nearly always fare better than those who sell their stocks (the "fearful").

So, if record diesel prices really do trigger a stock market crash, investors should heed Buffett's advice and stay invested in the stock market. After all, it made Buffett a billionaire and his company a trillion-dollar juggernaut. Just think what it could do for you.

John Bromels has positions in Berkshire Hathaway. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.