U.S. President Donald Trump stated on Sunday that the White House is ‘very seriously’ considering an export ban on diesel as the administration seeks to address record-high fuel prices ahead of the November midterm elections. Speaking to Fox News reporters during the Presidents Cup golf tournament in Illinois, Trump acknowledged that such a measure could lead to a slight increase in gasoline prices for cars but emphasized that the issue is being reviewed diligently.
The president has previously signaled support for restricting exports, noting that retail diesel prices had reached new record highs. While Energy Secretary Chris Wright indicated that the administration is considering restrictions rather than a total ban, reports from Politico suggest the Trump administration is preparing a plan to prohibit diesel exports for a 90-day period.
Average U.S. diesel prices hovered around $6.50 per gallon on Friday, according to AAA data, approaching the record high of $6.53 set on September 22. These surging costs are driven by global supply disruptions stemming from conflicts between the U.S. and Iran, as well as ongoing hostilities between Russia and Ukraine, which have disrupted key oil trade routes.
The proposal has faced immediate pushback from the U.S. energy sector. Mike Sommers, CEO of the American Petroleum Institute, argued in a statement that restricting U.S. energy exports would exacerbate refining challenges and ultimately hurt consumers. He urged for increased supply and flexibility instead of new restrictions that could worsen the difficult situation.
Financial analysts have also expressed concern over the potential economic fallout. Morgan Stanley strategists warned that while an export restriction might initially lower U.S. diesel prices, it could trigger adverse reactions globally and create a feedback loop that drives up domestic gasoline prices. Benedict George, head of European product pricing at Argus Media, noted that the U.S. has supplied about half of Europe’s diesel imports recently, and any restriction could push European prices and premiums to unprecedented levels.
George added that the uncertainty surrounding the global diesel supply crunch is extreme, with some traders ceasing efforts to forecast the market due to the unpredictable nature of the conflict in Ukraine and the semi-closure of the Strait of Hormuz. He described diesel as currently ‘the biggest problem for the global oil system,’ highlighting the significant impact of Ukrainian attacks on Russian refineries on global supply chains.
$6.50 a gallon is criminal. Anything the government can do to break the back of these energy companies right now is worth a try.
My trucking company depends on diesel. If we ban exports, global prices soar and shipping costs here will skyrocket. Just saying.
Wait, how does restricting exports actually increase supply? That logic seems backwards to me. Isn’t this just a temporary band-aid?
I just want affordable fuel for my commute. If this stops the price hike, I’m all for it, regardless of what the oil CEOs say.
Banning exports might lower prices here but will definitely spike them in Europe. Strange political move for midterm season.