There is an old arrangement in any serious energy crisis, and the United States has spent this one in the lucrative position: the world’s emergency fuel supplier. With the Gulf throttled by the war in Iran and Russian refineries being thumped by Ukrainian drones, American crude and diesel have been filling the gap, and the industry has been, as EL PAÍS puts it, making a killing. The trouble with being the emergency supplier is that emergencies are bad for incumbents. On September 22, diesel passed $6.50 a gallon at American pumps, and the emergency came home.
The average hit a record $6.52, the Guardian reported, and shortly after the threshold was crossed, President Trump — fresh from a meeting with Volodymyr Zelensky on the sidelines of the UN General Assembly — endorsed a remedy. “I’ve said, ‘Let’s not send out the diesel. We make a lot of diesel,’” he told reporters. “I’ve called for it. I’ve called for it within my people.”
It is no longer just a remark. On September 23, Politico reported that the administration plans a 90-day export ban, citing five sources familiar with the matter — running until the end of the year, which happens to be the peak season for diesel demand in both North America and Europe.
The timing is the tell. The November midterms are weeks away, most polls show Republicans losing both chambers, and the senators pressing hardest for the ban come from the Midwest — Iowa, Nebraska, Michigan, Kansas, Texas — Republican strongholds essential to surviving the election. Diesel, the fuel of trucks, tractors, trains and construction, has become the inflation issue no campaign slogan can outrun.
Inside the administration, the message has been less than synchronized. A White House official told CNN on Monday that no ban or even export restrictions were under consideration. Trump said the opposite on Tuesday. Treasury Secretary Scott Bessent then confirmed the administration is “examining” whether a full or partial ban is “feasible.” Energy Secretary Chris Wright has called it a “blunt tool” that could harm US fuel supplies long term — “The blunt tool of banning diesel exports definitely doesn’t work,” he said at an Economist event in New York, per Reuters — and Interior Secretary Doug Burgum has expressed his own doubts.
The oil lobby, normally a传教 of the administration, is also opposed. “Restricting US energy exports would only compound the problem — exacerbating refining challenges and ultimately hurting consumers,” said Mike Sommers, president of the American Petroleum Institute.
The buyers are not amused
What would the ban do abroad? Begin with Europe, where American diesel now supplies a third of imports this year — half in August — and a tenth of total consumption. The European Commission reacted with, in its word, concern. “Any disruption would risk negatively impacting both sides,” said spokesman Olof Gill, adding that the EU expects “close partners to consult each other before taking measures that affect shared markets.” High-level contacts, he said, are ongoing, which is diplomatic for: please stop.
Prices are already at record highs in Germany and the Netherlands, and after Trump’s words alone, diesel on the London market rose 7% even as crude stayed flat. EU prices for fuels and lubricants soared almost 24% year-over-year in August, per Eurostat. Europe produces about 70% of its own diesel, so forecourts would not run dry — but Josh Michalowski of Argus Media warns a ban “would be devastating for diesel supply in Europe, which would struggle to replace supply.” His colleague Benedict George predicts “some degree of panic given how reliant buyers have become on US cargoes,” with Europe bidding against Asia for the few spare cargoes out of the Middle East and India.
Britain is especially exposed. The RAC put diesel at 197.75p a litre on Thursday, up from 142.38p before the Iran war, and motorists may be days from fresh all-time highs. The UK has only four operating refineries after Grangemouth and Lindsey closed last year, and RSM UK economist Thomas Pugh calculates that losing some 90,000 barrels a day of American distillate — 18% of consumption — would make shortages, over a longer ban, a “real possibility.”
Yet the worst hit would be Latin America. “Almost a third of U.S. [diesel] exports go to South America, which would be the hardest-hit region, and Central America: together, they account for almost half of the total,” Jorge León of Rystad Energy told EL PAÍS. Of the seven biggest buyers of the 1.5 million barrels a day that leave American refineries, six are in Europe or Latin America: Brazil, Chile, Mexico, Peru, France and Britain. Kpler says the only exception is Morocco.
And the backdrop could hardly be tighter. The wars in Iran and Ukraine have knocked some five million barrels a day off global refining capacity, and the diesel premium over crude — the crack spread — hit a record earlier this month. “The underlying problem is that the rest of the global refining system doesn’t have enough spare capacity to compensate for these losses,” says Kerstin Hottner of Vontobel. American refineries already run at 97% of capacity, and US diesel stocks sit 13% below the five-year average.
The catch, in one barrel
Here is where the plan meets its problem — and, remarkably, the person explaining it is Trump’s own former energy secretary. “It’s one of those ideas that sounds good on the surface, but when you dig into it, it makes very little economic sense,” Dan Brouillette, who served from 2019 to 2021, told CNN. “Diesel comes from the same barrel of oil that gasoline does. So when you shut down diesel refining, you also shut down gasoline refining, which constrains the market, potentially raising the price of gasoline as well as diesel.”
The mechanism is well understood. Blocking exports would at first flood the Gulf Coast and Midwest with cheap diesel — trapped there, Brouillette notes, because pipelines to the coasts are insufficient. Then, with export margins gone, Kpler and Goldman Sachs both warn, refiners would cut total throughput, and gasoline prices would climb to mourn the diesel. All of it would land on what CNN notes is already on track to be the biggest annual percentage increase in diesel prices on record.
Brouillette’s verdict: “It’s a bad idea. It’s not something you want to impose.” He adds that the signal would chill the investment needed to expand US refining — the country has not built a major new refinery since 1977 — and recommends instead building infrastructure, offering tax and environmental incentives, and ending the Iran war, which the administration started in February. Gonzalo Escribano of Madrid’s Elcano Institute calls the ban “simplistic” and warns of “a growing fear that something similar could happen with oil and natural gas.”
It would, in fairness, be unprecedented: Congress lifted the crude export ban in 2015 under Obama, but diesel exports have never been banned at all. Brouillette says that if he were still in the Cabinet he would argue against it, then conceded the point that decides everything: “The ultimate decision maker is the president of the United States.”
Which leaves the world’s fuel buyers watching an American election the way you watch weather. The president can shut the valve, and for ninety days his voters would have the diesel and everyone else would not. But the barrel of crude does not know about borders, and it makes gasoline and diesel in the proportions physics prefers, not the polls. You can hoard the medicine. You cannot tell it which half to be.