US diesel export ban could backfire, analysts warn

President Donald Trump expressed support for a diesel export ban on Tuesday to address record-high US prices, but analysts warn the measure could worsen global supply and economic disruptions rather than ease them. Average US diesel prices have reached $6.5107 per gallon, according to AAA. Diesel prices have surged due to supply disruptions from Ukrainian strikes on Russian refineries and the US-Iran war, which has affected trade routes like the Strait of Hormuz. The US exported a record 1.6 million barrels per day in August, while on-road inventories sit nearly 13% below the five-year seasonal average. Major groups like the American Petroleum Institute oppose the ban, citing risks to refinery operations and domestic fuel markets. Analysts say a ban could push global diesel prices up by as much as 100% due to low price elasticity, while forcing US refiners to cut crude processing, which would raise gasoline prices. The measure could also damage relations with key allies like Europe, which relies heavily on US Gulf Coast supplies, and may have lasting effects similar to Nixon's 1973 soybean embargo.