President Donald Trump said he won't ban US diesel exports, after Group of Seven nations and their partners agreed to release some of their emergency fuel stockpiles in a bid to bring down soaring prices. “Europe has a lot of diesel and they're going to be making a major world contribution — and so are we,” Trump told reporters Friday at the White House. “And we're not going to be doing the export ban.”
The bloc, which includes major economies from Europe, North America and Asia, agreed to release as much as 100 million barrels of emergency oil and diesel stocks on Friday, after an intense pressure campaign from the Trump administration.
“I did ask them, and we're going to have a lot of oil,” Trump added. “They did a great job.”
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Trump's declaration comes amid a record surge in prices for diesel, which fuels much of the modern economy, powering farm equipment, propelling US shipping and supplying heat and power to rural communities.
Diesel's critical role as the lifeblood of shipping and commerce means the price increase has rippled through the economy, spurring higher costs for an array of consumer goods ahead of the November midterm elections.
The president's decision marks a retreat from his earlier consideration of possible diesel export curbs as well as a rebuff of endangered rural and Midwest Republicans who'd sought those limits to slash fuel prices weighing heavily on voters before the election.
Trump on Friday maintained the diesel export ban was never a serious option. “We were never going to do it,” he told reporters. “I don't think we were.”
Last month, the president said he had encouraged his advisers to support it.
Trump's current approach also represents a bid to thread the needle between two core constituencies: agricultural communities in the heartland, where some Republican incumbents are in tough races, and oil interests that have benefited from the president's support of fossil fuels.
In recent weeks, a number of prominent Republicans, including Senators Chuck Grassley of Iowa and Dan Sullivan of Alaska, who faces a tight reelection contest, had encouraged export curbs.
Yet oil industry leaders and energy experts warned that limiting foreign diesel sales would at most provide only short-term price relief followed by a rapid upswing in costs as swelling domestic inventories prompt US oil producers and refiners to cut production.
Some officials within the administration, including Energy Secretary Chris Wright and Interior Secretary Doug Burgum, have echoed those concerns internally.
Costs for fuel and other consumer goods register as among the chief complaints of voters ahead of the midterms. Diesel, in particular, has spiked as the wars in Russia and the Middle East sidelined refining and disrupted energy shipping.
The average retail cost of diesel in the US was $6.37 per gallon as of Friday, according to auto club AAA.
The oil release announced Friday and coordinated by the International Energy Agency is expected to offer only short-term relief. Supplies are set to be released over the next four months, with an initial focus on diesel, French President Emmanuel Macron said Friday.
Europe relies heavily on US diesel exports, and the stockpile release was seen as a bid to stave off a US ban on foreign fuel sales. G7 nations have now reaffirmed their commitment to “refrain from export restrictions on energy and energy products” between member countries.
In the US, oil executives have been beseeching Trump administration officials to consider other options, warning even short-term export restrictions would trigger domestic production cuts and harm US allies in Europe and Latin America.
Under one approach being seriously considered, the Trump administration would lift limits on the sale of red or dyed diesel, which is generally available for off-road use and is tax-exempt. The strategy would allow retailers to sell dyed diesel, which is exempt from the federal excise tax of 24 cents per gallon, for use in trucks and other highway vehicles.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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