Alaska Republican Senator Dan Sullivan is calling for a temporary halt to U.S. diesel exports as fuel prices surge, weeks after gasoline in one of the state’s remote villages soared to over $26 a gallon. President Donald Trump said Tuesday he backs the idea, as the administration examines whether a temporary restriction would be feasible. Sullivan proposed a moratorium until the conflict in Iran ends and energy exports resume flowing through the Strait of Hormuz, arguing that keeping more American diesel at home could help rebuild reserves ahead of winter and lower costs.
The national average has risen nearly 31 cents over the past week, according to GasBuddy. He added that continued strikes on Russian oil refineries are tightening global diesel supplies, while regional refinery issues are adding pressure in the Great Lakes. Any broader shift in diesel prices will depend heavily on overseas developments, with new Houthi attacks and fresh U.S.-Iran escalations leaving the outlook uncertain, De Haan said.
On August 26, Newsweek reported that drivers in Shungnak, Alaska, were paying $26.82 per gallon. Financial expert Michael Ryan told Newsweek that the extreme price was driven in part by local transportation problems, with fuel having to be flown in after low water levels prevented barges from reaching the community. The village has faced unusually high fuel costs for years, with gas reaching $14 per gallon in 2022, according to the Alaska Beacon.
When asked about Sullivan's proposal Tuesday, Trump said he had also called for a temporary halt to diesel exports. "I've called for that too. I've said, 'Let's not send out the diesel.' We make a lot of diesel," Trump told reporters on the sidelines of the United Nations General Assembly.
"That could have a little bit of an effect on regular automobile gasoline because when you do that, it's sort of a flow. It's a balance." Treasury Secretary Scott Bessent, who was seated near Trump, said the administration was considering whether an export restriction would be feasible. The American Petroleum Institute (API) said Tuesday that restricting U.S. diesel exports would worsen refining challenges and further sting consumers.
API said Gulf Coast refineries produce more diesel than the region consumes, making exports an important outlet for maintaining high refinery production. The group said limiting exports could force refiners to cut production of diesel, gasoline and jet fuel, tightening supplies even more. Several other Republicans have expressed support for the proposal this week.
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