• The Trump administration is actively considering a 90-day ban on diesel exports to curb record-high domestic prices, but no final decision has been made.
  • The proposal faces broad opposition from refiners and energy officials, who warn it could backfire by reducing refinery runs and raising gasoline prices.
  • Diesel prices are at unprecedented levels due to global supply disruptions, and a ban could strain relations with allies dependent on U.S. exports.

A Controversial Proposal

President Trump has thrown his support behind a plan to halt U.S. diesel exports for 90 days, a move aimed at tamping down record-high fuel prices ahead of the November midterm elections. The idea, first floated by Louisiana Gov. Jeff Landry, has gained traction among some Republican candidates and lawmakers facing tight races. But it has also sparked fierce opposition from refiners, oil producers, and even within the administration, where officials warn it could disrupt global markets and ultimately hurt U.S. consumers.

On September 22, Trump publicly endorsed the concept, saying he had already urged advisers to pursue it. “We’re looking at it very seriously,” he said, while acknowledging that restricting diesel flows could affect gasoline supply and prices. Treasury Secretary Scott Bessent added that the administration is studying refinery capacity and whether a full or partial restriction could work. No legal mechanism, implementation date, exemptions, or duration has been formally announced.

The push comes as U.S. diesel prices hover at $6.5107 per gallon, according to AAA, a level that is crushing farmers, truckers, and manufacturers. The pain is particularly acute in swing states, where high fuel costs have become a kitchen-table issue. The Agriculture Department has urged White House action, and several Republican lawmakers—including Sen. Dan Sullivan of Alaska, Rep. Ashley Hinson of Iowa, and Mike Rogers of Michigan—have pressed for relief.

But the proposal has exposed a split within the administration. Interior Secretary Doug Burgum has warned that other energy exporters could retaliate, a risk for regions like California that depend on imported refined products. Energy officials argue that restricting exports could cause refiners to cut crude processing, since refineries jointly produce diesel, gasoline, and jet fuel. Lower refinery runs could therefore reduce gasoline production and eventually raise prices at the pump.

A Global Supply Crunch

The diesel price spike is not merely a U.S. problem. It stems from a global distillate shortage driven by geopolitical disruptions. The Iran conflict has snarled shipping through the Strait of Hormuz, while Ukrainian attacks on Russian refineries have reduced Russian refined-product availability. As a result, the U.S. has become a critical marginal supplier to world markets, exporting a record 1.6 million barrels per day in August.

Domestic inventories are also thin. U.S. on-road diesel stocks stand at 96.97 million barrels, nearly 13% below the five-year seasonal average. Refineries are running at about 97% utilization, leaving little room to boost output. “We’re running flat out,” said one industry executive, who requested anonymity to speak freely. “There’s no magic switch to make more diesel.”

A temporary export ban could lower prices in some domestic markets, particularly near the Gulf Coast, by trapping more barrels in the U.S. But diesel cannot be easily redirected across the country. Pipeline, refinery configuration, port, and regional supply constraints mean a Gulf Coast surplus may not translate into lower prices on the East or West Coast.

Industry Pushback and Allied Concerns

The American Petroleum Institute has come out strongly against the idea, arguing that an export restriction would destabilize refinery operations and worsen a global refining crisis. “Gulf Coast refiners produce more diesel than their region consumes, and the infrastructure to move that fuel to other parts of the U.S. simply doesn’t exist at scale,” an API spokesperson said.

Foreign buyers and allies are also watching closely. Major recipients of U.S. diesel include Brazil, Chile, Mexico, Peru, Morocco, France, and the United Kingdom. Europe is structurally short of diesel and relies heavily on supplies from the U.S. Gulf Coast. Cutting off exports would tighten European supplies, harm allies already coping with the Russia-Ukraine war, and potentially push them to seek fuel from alternative suppliers.

“Even a temporary restriction could have a long-run reputational effect on U.S. fuel-export reliability,” said Philip Verleger, an energy economist who estimates that a ban could raise world diesel prices by as much as 100% because demand is relatively insensitive to price in the short run. Kenneth Medlock of Rice University’s Baker Institute argues that any domestic price decline would likely be brief because refining economics would ultimately compel refiners to cut runs.

The administration’s public position has shifted rapidly. Officials had earlier said export restrictions were not being considered, but Trump’s subsequent comments put the policy under active review. The White House did not respond to a request for comment.

What’s Next

The most likely immediate next step is an internal White House decision on whether to reject the proposal, pursue a narrower or partial restriction, or announce a time-limited export pause with exemptions. Treasury’s feasibility review suggests that policy design—not just political intent—is now central.

If an export ban is imposed, U.S. Gulf Coast diesel prices could fall temporarily. But global diesel prices would likely rise sharply, refineries could reduce throughput, and Europe’s diesel shortage could worsen. The long-term resolution depends more on geopolitics and global refining recovery than on export controls. An easing of conflict-related disruptions in the Middle East and restored refining supply from affected producers would address the main source of the price shock.

The central trade-off is clear: a ban may offer a visible domestic political response to high prices, but it risks exchanging a short-lived local benefit for weaker refinery incentives, higher global prices, stress on allies, and potentially higher U.S. gasoline costs over time.

Correction: An earlier version of this article misstated the date of President Trump’s public endorsement. It was September 22, not September 23.