Trump Backs Temporary Diesel Export Ban as Fuel Costs Ripple Through Economy

With diesel regularly notching up record highs, President Donald Trump has called for a temporary ban on exports of the fuel from the United States.

He was reminded that several Republican senators had called for a diesel export ban at the U.N. during a joint press conference with Ukraine’s President Volodymyr Zelenskyy.

“Well, I’ve called for that too. I’ve said, let’s not send out the diesel,” Trump said on Sept. 22.

America’s president appeared to be talking about policy discussions within the White House, as it was the first time he publicly backed a diesel export ban.

Diesel had hit a new national average record high that day of $6.52 per gallon, according to the AAA Fuel Prices Index.

Trump had telegraphed the policy shift on his own Truth Social account the previous day, in a post that also involved Ukraine.

“Russia has unfortunately lost control of its Diesel Oil Industry due to its War with Ukraine,” he wrote on Sept. 21. “A large number of their Diesel refineries have been blown up and are, at least temporarily, out of commission.”

He also wrote that the “ridiculous and never ending War with Ukraine must be ended.”

“The whole World suffers as 25,000 people, mostly soldiers, are being killed each month. What a shame!” Trump said.

Export Controls: America and Russia

The exchange came the week after Rep. Tim Burchett (R-Tenn.) introduced two bills in the U.S. House of Representatives to tamp down diesel exports.

One bill, H.R. 10423, would enact an export control ban on diesel until January of next year.

The other bill, H.R. 10422, is a more complex export control measure, aimed at colleagues who want more affordability but are reluctant to go for a blanket ban.

The temporary ban would be lifted “when prices drop at or below $4.50 per gallon for 30 consecutive days,” according to Burchett’s congressional website.

Experts caution that could take some time. Rising diesel prices are driven by many factors, and costs may not ease anytime soon.

“Globally, strikes on Russian refineries plus the continued challenges with the Strait of Hormuz are restricting the ability of suppliers to meet demand,” Philip Rossetti, vice president of environment, innovation and transportation for the Lighthouse Energy Institute, told The Epoch Times.

Ukraine’s attacks on Russia’s oil refining capacity have reduced the volume of available diesel so much that Russia enacted its own export controls on diesel in July.

Diesel Costs: How High?

Since America joined hostilities along with Israel against Iran at the end of February, Americans have borne over $51 billion directly in excess diesel costs. That’s according to Brown University’s Iran War Energy Cost Tracker. The tool is intended to measure the costs of hostilities in Iran and the oil shipping slowdown through the Strait of Hormuz, but it has also captured some costs of the Ukraine-Russia conflict.

On the same day Trump endorsed a diesel ban, the Stimson Center released a report estimating the total cost of hostilities in Iran at $220 billion through the middle of September, or about $1,650 per U.S. household.

The Stimson estimate exceeds the total cost of the extended spike in diesel, but it does capture some of the knock-on costs driven by higher fuel prices.

Rossetti said that current global refinery capacity for diesel is limited, which “puts a ceiling on production and thus supply,” which works to ratchet up prices.

The composition of a car fleet can change somewhat in response to high gas prices, but diesel is a different, more difficult story.

“Because much of the demand goes to very expensive commercial vehicles the rollover of capital stock in response to elevated prices is slow,” Rossetti said, adding that at this time there are “practically no electric semi trucks outside a handful in operation.”

What that means is that increases in diesel prices push up the price of moving goods via diesel-powered trucks and other vehicles, including trains.

The rising price of diesel pushes up shelf prices on everything from bread to baseball bats to circuit breakers. Because the effect on prices is so widespread, it may also have motivated the Federal Reserve to push up interest rates to fight inflation.

“There’s a ripple effect from all of this that affects the larger economy,” Michael Cohen, author of the Stimson report, told The Epoch Times.

“A lot of the economic issues we are dealing with right now are tied to the war. Would inflation be up by a point? Would the mortgage rates be up a point and a quarter if not for the war? I doubt it,” he said.

The Epoch Times reached out to Secretary of Energy Chris Wright about what is being done to address rising fuel prices and to Senate Minority Leader Chuck Schumer (D-NY) about the proposed diesel export fuel ban. Neither replied by the time of publication.