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Donald Trump has said he may ask European countries to release some of their diesel reserves as he considers banning US exports of the fuel.
The president’s comment comes after diesel prices hit record highs on UK forecourts this week, as the Iran war continues toput pressure on the supply of refined fuels.
The UK is heavily reliant on imported diesel from the US. But with US voters also facing higher fuel costs ahead of the midterm elections in November, Trump has threatened to restrict diesel exports.
The UK has been discussing the US supply threats with the EU which is holding a meeting on Friday on the issue.
Banning exports would flood the US market with diesel, and could bring prices down significantly for American drivers.
But experts warn such a ban would put further pressure on diesel prices in other countries, unless they can access further supplies.
The US is a vital supplier of diesel to the world, exporting between 1.2 and 1.5 million barrels per day, with most of it going to Latin America.
European countries including France, the Netherlands and the UK, also import a significant amount from the US following the reduction in Russian and Middle Eastern
Russia’s invasion of Ukraine led to sanctions, diverting Russian sales away from Europe. More recently Ukrainian attacks on Russian refining capacity has had a knock-on effect on global supply.
The US-led war on Iran has constrained the flow of both crude oil and refined diesel from that region.
On Thursday, Trump was asked whether he would call on European countries to release some of their own diesel reserves.
“We may do that. They have some diesel,” he said.
An earlier post from US Treasury Scott Bessent on social media urged Europe to get ready to release some of their own diesel supplies immediately, arguing that US farmers, truckers, and businesses “should not be left carrying the burden” as prices soar.
Diesel prices in the UK hit record highs this week and are hovering just under 200p per litre, according to motoring organisation the RAC.
Over half of the UK’s diesel is imported, with 31% of the imports coming from the US.
The Netherlands and Belgium together provide more than a third of UK diesel imports.
UK Energy Minister Martin McCluskey was on a call with European counterparts on Thursday to discuss the potential ban.
A prepare a co-ordinated response with other countries, including those across EU, but added that there were still European reserves left from a coordinated release of strategic fuel stocks earlier in the year
“We have a diverse and resilient supply. We continue to engage with our international partners and the UK fuel industry,” a government spokesperson said.
The government has stressed that there is no cause for concern about potential diesel shortages, though prices are expected to rise further.
International Energy Agency rules say member states, including the UK, must hold oil stocks equivalent to 90 days of net oil imports.
EU rules say member must hold reserves to cover 61 days of domestic consumption. In total the EU holds nearly 109 million tons of emergency crude and fuel stocks, with around a third in diesel and related fuel products.
A European Commission spokesperson said that there were “lots of calls, lots of meetings” taking place on the diesel situation, including with “high level contacts” in the US administration.
Potentially adding to the pressure on the global diesel market, Chinese refiners have reportedly halted October exports of some fuel products as Beijing prioritises domestic supplies.Prices of petrol and diesel globally have skyrocketed since the outbreak of the US-Israel war in Iran in February. The closure of the vital Strait of Hormuz, which typically transports around a fifth of the world’s oil and gas, has pushed up the price of products made from oil.
An export ban from Russia, also a major supplier of diesel, has added to the pressure on prices.
Trump has argued that keeping any surplus barrels of diesel in the US would lower pump prices domestically, offering immediate relief to drivers, truckers, and businesses ahead of the midterm elections.
But David Fyfe, chief economist at Argus Media, said cutting off American supply would be likely to cause international prices to skyrocket.
Diesel prices have hit an all-time high in the UK, with the latest RAC figures showing average pump prices at 199.79p per litre, up from 142.38p
Diesel is harder to refine than gasoline and, because it is used by the haulage industry and in agriculture, it is very difficult to reduce demand.
The UK has four refineries which produce more than enough petrol to meet demand, they do not make enough diesel to meet the country’s needs.
There were 15.1 million diesel vehicles on UK roads at the end of June, according to the Department for Transport. That is a drop from 15.7 million a year before.
There were 9.8 million diesel cars, down year on year from 10.4 million.
