President Donald Trump has publicly endorsed a temporary ban on U.S. diesel exports as national fuel prices surge to record levels. The proposal, which Trump first signaled on September 22 during the UN General Assembly, follows calls from Republican senators and representatives to curb exports to address domestic supply concerns. The national average diesel price reached $6.52 per gallon on September 22, according to AAA, up from $3.69 a year earlier.
Trump’s endorsement and legislative proposals
Trump stated on September 22 that he had advocated for restricting diesel exports within his administration, saying, “I’ve said let’s not send out the diesel.” His remarks came after Republican Senator Dan Sullivan of Alaska introduced a bill (H.R. 10423) to impose a temporary moratorium on diesel exports until January 2025, with the restriction lifting if prices fall to $4.50 per gallon for 30 consecutive days. Sullivan argued that “American fuel should stay home with Americans” to lower costs, particularly in rural and remote areas where prices have spiked. In Alaska, the average diesel price reached $6.67 per gallon, including a reported $26.82 per gallon in the village of Shungnak due to logistical constraints.
Oil prices and market reactions
Brent crude futures for November delivery hovered near $100 per barrel, while West Texas Intermediate (WTI) futures traded around $90 per barrel on September 24. Analysts at Citi warned that a diesel export ban could further tighten global supply, potentially benefiting refiners in Asia while increasing prices for U.S. consumers who rely on imports. Patrick De Haan of GasBuddy cautioned that reduced refinery runs could lead to higher gasoline prices, noting that the national average for regular gasoline stood at $4.47 per gallon. Garrett Golding of the Federal Reserve Bank of Dallas added that an export ban could “boomerang back on portions of the country that rely on imports,” such as the East and West Coasts.
Administration and congressional responses
The proposal has faced internal skepticism within the Trump administration. Energy Secretary Chris Wright previously stated in May that restricting exports would force refineries to reduce production, undermining energy security. Interior Secretary Doug Burgum also expressed doubt about the ban’s effectiveness, telling CNBC that he was “not at all confident” it would lower prices and warning of potential retaliation from other nations. Despite these concerns, Treasury Secretary Scott Bessent indicated on September 24 that officials were evaluating the feasibility of a partial or full ban, though no executive order had been issued as of that date.
Policy precedents and economic implications
Republican Senator Chuck Grassley of Iowa invoked a Nixon-era soybean export embargo as a precedent for the proposed diesel ban, suggesting it could protect consumers. However, economists note that the 1973 soybean embargo led Japan to seek alternative suppliers, ultimately benefiting competitors like Brazil. The diesel surplus in the U.S. is concentrated on the Gulf Coast, where refineries depend on export markets. A ban could reduce refinery activity, potentially decreasing gasoline production and raising prices further. The ban’s supporters argue that keeping more diesel domestically could help rebuild reserves ahead of winter, while critics warn of unintended consequences, including retaliatory measures from trading partners.
Geopolitical drivers of fuel prices
Rising diesel and gasoline prices have been attributed in part to supply disruptions from the Russia-Ukraine war and tensions involving Iran. Strikes on Russian oil refineries and Houthi attacks in the Red Sea have tightened global diesel supplies, while regional refinery issues in the Great Lakes have added localized pressure. The U.S. produces more diesel than it consumes, but distribution challenges limit the ability to redirect surplus fuel to areas with the highest demand.