President Trump is reportedly weighing a 90-day ban on diesel exports in an effort to cool rising costs at the pump, according to reports. US diesel prices have more than doubled from lows seen approximately nine months ago, driven by supply shocks linked to the Middle East and Ukraine.
Data from AAA places the national average near $6.52 per gallon, marking a sharp increase from $3.69 a year earlier. If implemented, a shipment curb would mark the first US energy-export restriction since the Obama administration lifted the long-running crude oil export ban in 2015.
However, Energy Secretary Chris Wright has publicly argued that a blunt export ban would be ineffective. As the world's largest diesel exporter, the United States relies on refineries that produce diesel alongside gasoline and jet fuel.
“The blunt tool of banning diesel exports definitely doesn’t work because the U.S. exports a lot of diesel,” Wright stated. “We’re the largest diesel exporter in the world, but that same refinery that produces diesel also produces gasoline and jet fuel. So, if you can’t export the diesel that comes out of our refineries when you run out of places to store it, and you have to reduce US refining, which would put upward pressure on gasoline prices and jet fuel prices.”
Following reports of the potential export ban, diesel futures fell by about 7%. Meanwhile, a White House spokesperson disputed the reports regarding the 90-day diesel export ban, stating that the story is false and noting that the Energy Secretary had already addressed the matter publicly.
