European officials are urging the Trump administration to avoid restricting U.S. diesel exports as governments and industry groups warn that limiting overseas shipments could tighten fuel supplies and raise costs in both the United States and Europe.
By yourNEWS Media Newsroom.
The European Union stepped up diplomatic pressure on Washington on Thursday over reports that the Trump administration is considering restrictions on U.S. diesel exports, warning that interference with fuel shipments could create economic consequences on both sides of the Atlantic.
European Commission spokesman Olof Gill said discussions between senior EU and U.S. officials were already underway as Brussels sought clarity about the administration’s plans.
“The European Union views with concern the report that the U.S. plans to ban diesel exports, including to the European Union,” Gill said while responding to a question from Politico.
“Any disruption would risk negatively impacting both sides.”
Gill said “high level contacts between the European Union and the U.S. administration are ongoing” and that the EU expects “close partners to consult each other before taking measures that affect shared markets,” Politico reported.
He did not provide details about the diplomatic discussions but pointed to opposition to the proposal within the United States.
“There are strong voices — also there — that believe any proposed ban of this nature would be a very bad idea indeed,” Gill said.
The European response followed reports Wednesday that the administration was preparing a temporary restriction designed to keep more diesel within the United States as domestic fuel prices rise ahead of the November midterm elections.
Politico, citing five people familiar with the discussions, reported that officials were preparing a 90-day prohibition on diesel exports intended to help bring fuel prices down.
The possibility of restricting exports has surfaced as U.S. diesel prices have climbed sharply. The national average reached about $6.52 per gallon this week, 76% higher than a year earlier, according to AAA.
President Donald Trump publicly raised the possibility Tuesday during an appearance at the United Nations.
“I’ve said let’s not send out the diesel,” Trump said, adding that a decision would come “fast, one way or the other.”
The proposal, however, has encountered opposition within Trump’s own administration.
Energy Secretary Chris Wright rejected the idea of a broad prohibition Wednesday, arguing that preventing exports could ultimately reduce the amount of fuel produced by U.S. refineries.
“The blunt tool of banning diesel exports definitely doesn’t work,” Wright said.
A White House official later said the administration was not considering an outright export ban, although officials have maintained that all options remain under review.
The debate has drawn particular attention in Europe, where U.S. fuel shipments have become increasingly important as the continent deals with constrained supplies.
European diesel prices rose 7% Wednesday morning as reports about a possible U.S. restriction circulated, according to Semafor.
“Given the precarious situation that Europe currently finds itself in, any further restrictions on fuels available to the EU at this stage could quickly become very serious,” an industry source who follows the market told Politico on the condition of anonymity to discuss the matter openly.
Opposition is also coming from major U.S. business organizations concerned that limiting exports could produce the opposite effect from the administration’s stated objective of reducing domestic fuel costs.
Thirty-six organizations, including the U.S. Chamber of Commerce, the Business Roundtable and the American Petroleum Institute, sent a letter Wednesday warning against restrictions on diesel shipments abroad.
The organizations said export limits “would lead to less fuel production, tighter supplies, and rising costs for American families, farmers, and truckers.”
The dispute leaves the administration weighing concerns over historically elevated domestic diesel prices against warnings from U.S. industry groups and European officials that restricting exports could reduce refinery production, tighten available supplies and disrupt interconnected fuel markets.
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