Republican Senator Chuck Grassley has appealed to President Donald Trump to impose a ban on diesel exports. His aim is to lower domestic fuel costs, which he claims are ‘KILLING FARMERS’ INCOME.’
On Saturday, Grassley encouraged the president to enact an embargo on diesel exports, akin to the 1970s embargoes on agricultural products. These historical embargoes, such as those on soybean exports by Richard Nixon’s administration, were responses to rising food prices.
The request comes at a time of supply constraints due to the Iran war and other global pressures. The national average price for diesel has surged above $6 per gallon, reaching a new peak of $6.51 on Sunday. This is a significant increase from $3.70 per gallon a year ago. In Iowa, prices have climbed from $5.35 to a record $6.29 over the past month. These rising costs pose difficulties for farmers nationwide and could impact the GOP in the upcoming midterm elections.
Newsweek has contacted Grassley’s office and the White House for comments.
Farmers Struggle with Record Diesel Prices
The Watson School of International and Public Affairs at Brown University reports that U.S. households have spent an extra $50 billion on diesel since the Iran war started. Diesel prices have increased about 77 percent, reaching $6.49 by Sunday.
With diesel costs surpassing previous highs in early September, the agricultural sector voices concerns over their financial stability and American food supplies. The urgency has intensified with the crop-harvesting season requiring operational machinery like tractors and combines.
John Boyd, founder of the National Black Farmers Association, expressed worries to Newsweek. He stated farmers face financial strain, losing profit margins, and potentially going out of business. He criticized the situation, saying, “Based on 10-dollar diesel fuel, we are losing the war.”
The Department of Agriculture responded by acknowledging Trump’s recognition of diesel’s importance to American agriculture. They assured that no stone is left unturned to address this temporary issue.
Debate Over Export Embargo
In the past year, the U.S. exported nearly 400 million barrels of diesel, according to the Energy Information Administration. Since the Iran war began, the global shortage has driven further exports, with May reaching an export high of nearly 50 million barrels.
Grassley highlights that past embargoes tackled inflated prices, and some Republicans support a temporary export ban. On Tuesday, Senate Majority Leader John Thune expressed openness to considering an export ban. Additionally, Tennessee Representative Tim Burchett proposed a bill to ban diesel exports until January 2027.
Burchett’s office issued a press release stating that diesel powers essential machinery and equipment. Higher fuel costs inevitably translate to higher consumer prices for groceries, goods, and services.
However, Interior Secretary Doug Burgum questioned the benefits of such a ban. He warned it might not lower diesel or gasoline prices and could provoke retaliation from other countries, affecting U.S. imports.
The American Fuel & Petrochemical Manufacturers, representing the oil industry, also opposes the ban. They argue it could reduce domestic fuel production, push up prices, and undermine U.S. energy security. In their fact sheet, they assert that export bans ultimately reduce U.S. fuel production and elevate prices by handing market share to foreign competitors.
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