U.S. Diesel Export Ban Could Push Gas Prices Higher

The proposal comes as diesel remains near a peak. AAA figures put the fuel at $6.53 per gallon on Sept. 22, followed by a small decline to $6.45 on Monday. Republican lawmakers have recently increased pressure for export limits, arguing that keeping more diesel in the country could reduce costs for farms, trucking companies and other businesses.

U.S. refiners currently send abroad roughly 1.5 million barrels of diesel each day because domestic production exceeds consumption, S&P Global Energy figures show. Goldman Sachs calculated that an export halt might initially lower diesel prices by around 25 cents per gallon. That benefit would last only while refiners could store the surplus. After storage filled, Goldman projected that every additional week of restrictions could add 30 cents per gallon to gasoline prices.

Diesel, gasoline and jet fuel are generally refined together. Industry analysts expect companies facing excess diesel to reduce overall refinery output, which would also shrink gasoline supplies. JPMorgan analysts said the economics of refining both fuels would begin to strain if restrictions continued beyond 30 days. For Simi Valley commuters and families who make regular car trips, that could mean higher prices at gasoline pumps even as diesel becomes cheaper at first. A White House official said Trump is reviewing possible ways to reduce fuel prices, but no policy choice has been made.