From CNBC · Spencer Kimball · · 2m
Oil industry warns diesel export ban will raise fuel prices
Trump considers restricting diesel exports to tackle rising fuel prices ahead of midterm elections, but energy experts warn the policy would backfire.
In brief
Trump considers restricting diesel exports to tackle rising fuel prices ahead of midterm elections, but energy experts warn the policy would backfire. President Trump is weighing a diesel export ban to lower fuel prices before November midterms, but the oil industry and energy analysts warn it would raise prices and…
Trump backs diesel export ban
President Donald Trump indicated support for banning diesel exports this week, saying he has called for the restriction within his administration.
“I've said let's not send out the diesel. We make a lot of diesel.”
Oil lobby warns of backfire
The American Petroleum Institute pushed back immediately. CEO Mike Sommers said restricting energy exports would exacerbate refining challenges and hurt consumers.
“restricting U.S. energy exports would only compound the problem, exacerbating refining challenges and ultimately hurting consumers.”
Refiner stocks fall on ban reports
Shares of Valero, Marathon Petroleum and Phillips 66 fell Wednesday after Politico reported the Trump administration was preparing a plan to ban diesel exports for ninety days.
Energy Secretary considers restrictions
Energy Secretary Chris Wright told the Wall Street Journal the administration was considering restrictions rather than an outright export ban, trying to avoid blunt government policy.
“We're trying to avoid a blunt hammer of a government policy, understanding the complexity of refining.”
Ban would raise gas prices
An export ban would result in more expensive gasoline right away, Wright said. U.S. refineries would cut production as storage tanks fill, reducing overall fuel supply.
“If you start putting barriers on flows, pretty quickly you will reduce the production, and you'll have less supply.”
Analysts predict significant price hikes
An oil industry executive told CNBC a diesel export ban could raise fuel prices by thirty cents per gallon. Patrick De Haan at GasBuddy said gasoline prices could rise toward record levels.
Trade retaliation risk looms
Bob McNally, president of Rapidan Energy, warned U.S. trade partners could retaliate. Europe could ban gasoline exports to the U.S., particularly hurting the import-dependent Northeast.
Election pressure drives consideration
The White House faces mounting pressure from Republican lawmakers to implement an export ban as diesel prices reached record highs ahead of November midterm elections.
Decision still uncertain
Treasury Secretary Scott Bessent said the White House is examining whether an export ban is feasible and whether a full or partial ban would work. Trump wants gas prices to fall.
The main idea
President Trump is weighing a diesel export ban to lower fuel prices before November midterms, but the oil industry and energy analysts warn it would raise prices and invite trade retaliation.
