{"id":22319,"date":"2026-09-27T08:37:00","date_gmt":"2026-09-27T00:37:00","guid":{"rendered":"https:\/\/linkpgm.com\/?p=22319"},"modified":"2026-09-26T20:38:24","modified_gmt":"2026-09-26T12:38:24","slug":"trump-administration-makes-a-u-turn-on-diesel-policy-total-export-ban-eased-red-diesel-becomes-a-real-option","status":"publish","type":"post","link":"https:\/\/pg-markets.com\/en\/trump-administration-makes-a-u-turn-on-diesel-policy-total-export-ban-eased-red-diesel-becomes-a-real-option\/","title":{"rendered":"Trump Administration Makes a U-Turn on Diesel Policy: Total Export Ban Eased, \u201cRed Diesel\u201d Becomes a Real Option"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">One option under discussion at the White House is to expand the use of dyed diesel, also known as \u201cred diesel.\u201d Red diesel is chemically identical to regular diesel but is typically restricted to off-road uses, such as agricultural machinery, and is exempt from certain federal and state excise taxes. <br\/>The federal diesel excise tax in the United States is approximately 24 cents per gallon, with state taxes adding an average of about 36 cents. If the government were to temporarily allow more on-road vehicles to use tax-exempt red diesel, the end costs for farmers, truck drivers, and other diesel users could be directly reduced without the need to alter global trade flows. <br\/>Louisiana has already announced emergency measures allowing farmers and loggers to use off-road diesel on public roads during specific periods; Alabama and Nebraska have adopted similar approaches. State policies are primarily focused on the fall harvest season, with the aim of reducing transportation and machinery operating costs for agriculture. <br\/>The industry has also proposed adjustments to the Renewable Fuel Standard. Some refineries want red diesel to be excluded from the calculation of federal biofuel blending quotas. Industry estimates suggest that if such fuels were exempted and made available for purchase by farmers, prices could fall further by about 30 cents per gallon. <br\/>Energy Secretary Chris Wright has stated on multiple occasions this week that he does not support a complete ban on diesel exports. The approach he has proposed involves working with refiners to adjust certain diesel flows and supply arrangements, thereby increasing domestic availability in the U.S. while maintaining exports. <br\/>This stance is tied to the operational logic of the refining industry.Refineries along the U.S. Gulf Coast have long produced more diesel than the region\u2019s domestic demand, with export markets absorbing the surplus. If exports were to suddenly stop, inventories would quickly build up, and refineries might be forced to reduce their crude oil processing volumes. <br\/>When refineries reduce processing volumes, it is not only diesel production that decreases. Gasoline and jet fuel production would also decline simultaneously, potentially shifting policy pressure originally aimed at diesel prices to other fuel markets. The White House therefore needs to strike a balance between lowering diesel prices and maintaining output across the entire refining system. <br\/>Tax relief is not without its implementation hurdles either. Bloomberg reports that a proposal to suspend the federal diesel excise tax has been discussed within the administration, but with the U.S. House of Representatives currently in its pre-election recess, procedural issues remain regarding how to implement the measure through legislative or administrative channels. <br\/>Diesel prices currently remain around $6.50 per gallon. Even if restrictions on red diesel are eased, Bloomberg estimates that the actual purchase price for some farmers may drop back below $6, but this is still significantly higher than the pre-Middle East war level of under $4. <br\/>The White House has not yet announced a final plan. The most clear-cut change at this stage is that a blanket export ban is being phased out as a primary option, and policy discussions are shifting toward tools such as taxes and fees, the scope of &#8220;red diesel,&#8221; biofuel regulations, and voluntary supply increases by refineries. Energy Secretary Wright stated that the U.S. will not halt diesel exports, but the way diesel flows from refineries to different markets may be adjusted.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>One option under discussion at the White House is to expand the use of dyed diesel, also known as \u201cred diesel.\u201d Red diesel is chemically identical to regular diesel but is typically restricted to off-road uses, such as agricultural machinery, and is exempt from certain federal and state excise taxes. The federal diesel excise tax [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":22314,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[416],"tags":[],"class_list":["post-22319","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-trading-news"],"_links":{"self":[{"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/posts\/22319","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/comments?post=22319"}],"version-history":[{"count":1,"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/posts\/22319\/revisions"}],"predecessor-version":[{"id":22320,"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/posts\/22319\/revisions\/22320"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/media\/22314"}],"wp:attachment":[{"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/media?parent=22319"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/categories?post=22319"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/pg-markets.com\/en\/wp-json\/wp\/v2\/tags?post=22319"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}