Diesel prices have already reached a record national average of $6.52 a gallon

Energy markets moved higher Wednesday as traders considered President Donald Trump’s proposal to limit US diesel exports, raising concerns about potential ripple effects across fuel markets.

The administration is reviewing the proposal, but analysts warn it could disrupt global fuel markets and ultimately drive up prices for American consumers.

The stakes are high: The Iran war has sent fuel prices to record highs, midterm elections are on the way, and recent NBC polling shows voters turning against the Trump administration’s economic performance.

Brent crude traded around $100 a barrel, while US West Texas Intermediate crude hovered near $90. The gains came after Trump said the US should keep more diesel at home as fuel costs climb.

Diesel prices have already reached a record national average of $6.52 a gallon, up from $5.81 in June 2022. Gasoline stood at about $4.47 a gallon as missile attacks disrupted refineries and trade routes in the Middle East and Russia. 

Why the ban is being considered 
The US exports about 1.4 million barrels of diesel and other distillates each day, mainly to Latin America and Europe. The administration is examining whether limiting those shipments could increase domestic supplies and ease pressure on American fuel prices.

What could go wrong
US refineries produce diesel and gasoline together. If exports stop, refiners could cut production rather than accumulate excess diesel. That would also reduce gasoline and jet-fuel supplies, potentially pushing their prices higher.

S&P Global estimates that a complete export ban could force US refineries to reduce output by nearly 2 million barrels a day.

A diesel export ban could initially weigh on US prices by leaving more fuel at home. But Goldman Sachs projects a longer-term effect could be higher pump prices as domestic production declines, while industry officials warn of higher import and shipping costs.

The US could also face greater pressure in global markets as China, Japan and South Korea have reduced diesel shipments, leaving fewer major suppliers available.

The administration has not made a final decision. Energy Secretary Chris Wright has opposed the idea.