In this aerial view, Dan Duffy uses a tractor to plant soybeans on land he farms with his brother on April 28, 2025 near Dwight, Illinois.
Scott Olson/Getty Images North America
hide caption
Scott Olson/Getty Images North America
Stay up to date with our First newsletter, sent every morning of the week.
Less than a month before the midterm elections, the price of fuel is becoming a powerful electoral question.
This week, President Trump released a decree aims to reduce costs for frequent diesel users by making a type of fuel called “dyed diesel” more accessible through the end of the year.
Could this reduce the cost of diesel? Let’s go.
Why is diesel so expensive right now?
Prices of all kinds of oil products have risen this year because fewer ships are passing through the Strait of Hormuz and carrying crude to refineries around the world – but the diesel supply chain has been particularly hard hit. Ukraine’s recent attacks on Russian refineries have knocked many of them offline, and Russia has cut its diesel exports. China too.
Added to this is a limited supply of diesel – a fuel that powers much of the industrial supply chain.
Its price has therefore soared; the American average for a gallon broke a record from $6.52 a few weeks ago. The price has fallen a bit since then, but a gallon remains about $2.60 higher than this time last year, according to AAA.
Analysts say when diesel prices rise, inflation will likely follow. Diesel powers much of the industrial supply chain, from agricultural equipment to trucks moving goods from warehouses to grocery stores.
What is tinted diesel?
The “dye” part means: red dye. “Red-dyed diesel is diesel that contains red dye. That’s it,” said Will O’Neill, senior analyst at S&P Global Energy and a fan of all things diesel.
Chemically, this diesel is almost identical to the regular type found at most gas stations. But it’s a different color because it’s used and taxed differently.
Red dyed diesel is only for off-road vehicles, primarily agricultural and construction equipment, such as a tractor used in a field. It is exempt from federal tax 24.4 cents per gallon on commercial diesel.
Drivers are not supposed to use it in vehicles traveling on highways. People who do so are subject to an IRS penalty – either $1,000 or $10 per gallon, whichever is greater.
The red color makes it easier to catch someone who has filled their tank with the wrong substance. Using red-tinted diesel is “effectively a form of tax evasion,” O’Neill said.
But the new decree stipulates that tinted diesel will be authorized on motorways until the end of the year. The IRS will not penalize anyone who uses it.
Will this save people money?
This could help farmers, truckers and other workers who rely on diesel to do their jobs. THE decree said the move would inject money directly into their pockets “to support their vital service to our nation”.
It essentially expands how workers can use dyed diesel, saving them the federal tax. Imagine a farmer who usually puts tinted diesel in his tractor. He can now also legally use it to fill up his van, take the highway and take his produce to market.
Additionally, a handful of states have declared that drivers can use red-tinted diesel on their vehicles. their highways. On averagestate taxes on diesel are about 35 cents per gallon. Allowing drivers to use dyed diesel — and avoid federal and state taxes — could amount to a savings of about 60 cents per gallon.
But because the cost of a gallon of regular diesel is now about $2.60 higher than this time last year, drivers will still pay a higher price overall.
Will this put more diesel on the market?
Technically, this will increase the total amount of diesel people consume. could to use.
But Jaime Brito, executive director of oil markets at Dow Jones Energy, points out that doesn’t mean most people can easily access dyed diesel. It is not available at most gas stations. “When was the last time you went to a pump station and saw that one of the stations gave you the option to put red diesel into your truck?” he asked.
Instead, people would have to go to a special wholesaler – or could find it at gas stations in rural areas.
In an email to NPR in response to the criticism, White House spokesperson Taylor Rogers wrote that the president wants to see prices fall and is taking “historic steps” to ease oil supply disruptions.
Is there anything else the Trump administration can do to lower diesel costs?
Over the past month, some politicians have floated the idea of a ban on export of diesel. The idea was that if the United States stopped sending diesel to other countries, perhaps it would temporarily increase supply in the United States, which would lower prices.
But ultimately: the refiners pushed back. It would be a bad deal for them.
Refiners make money by selling diesel in the United States and exporting it around the world, said Jacques Rousseau, who focuses on oil, natural gas and refined products as a managing director at Clearview Energy Partners.
If there is was a diesel export ban, of course, that diesel would stay in the United States. But refineries would then be left with an extra ton of diesel. “Then it will start to be stored. And then once your storage is full, you will then have to reduce your overall refinery production. So you will start producing less of everything else too, because you have nowhere to put that diesel,” Rousseau said.
Ultimately, this could lead to higher prices for refined petroleum products, such as gasoline – and diesel. up.
President Trump said Friday evening that he not seriously considering an export banand that the United States no longer needed it, since Europe had just published approximately 100 million barrels of diesel and crude oil from its own stocks.
Analysts told NPR that the only real solution would be to end the wars in Iran and Ukraine. Until oil moves freely around the world, they say, it’s hard to imagine the price of diesel falling much. “There’s no silver bullet,” O’Neill said. “There’s no way we’re going to snap our fingers and end up with a $4 diesel before the election.”
“Unless there is a rapid and credible conclusion to the wars,” he continued, “I don’t see that happening.”
Gn headline
