Trump said on Tuesday his administration is discussing a possible ban on diesel exports “every day” as the White House tries to contain rising energy prices. Trump said restricting diesel exports overseas would decrease domestic diesel costs but warned that it might also drive up gasoline prices.
Trump said on Sept. 30 that the administration is still examining the implications of an export ban. The proposal comes as diesel prices in the United States remain extraordinarily high and pressure sectors that rely heavily on fuel trucking, farming, and other industries are hurting.
According to Reuters, US diesel prices reached a record $6.53 per gallon a week earlier and gasoline prices had risen by more than 40% from the previous year. That high level of inflation had added pressure on the administration to address fuel costs and to fix them.
Trump cited the rise in diesel prices largely as a result of disruptions associated with Russia’s war in Ukraine. Attacks on energy production and exports were also one of the reasons for the tighter diesel market, he said.
Energy Secretary Chris Wright said the disruptions were broader than just the Russia-Ukraine conflict. Wright said the United States had also lost some diesel exports from the Middle East but some of them were being restored. He also cited reduced diesel exports from China as another disruption to global supplies.
The White House is therefore considering a wide range of potential measures rather than a blanket export ban. The White House also has asked the European Union to release emergency diesel stocks to increase available supplies.
The potential export restriction will also have global impact, because the US is a major exporter of diesel to international buyers. Shorter exports could affect global fuel flows at a time when supplies are already being affected by geopolitical tensions and refinery disruptions.
Trump has admitted that restricting diesel exports could affect gasoline prices because various refined fuels are interlinked. And what he does indicate is the administration is weighing up the domestic benefits of diesel imports against the impact on other fuel markets.
There is no announced U.S. diesel export ban at the moment. And the administration is still mulling various options to tackle high energy costs and a global fuel shortage.
