President Donald Trump asked Chinese President Xi Jinping to increase Beijing's production of certain types of petroleum products as the White House contends with high gas and diesel prices ahead of November's crucial midterm elections. During the Chinese leader's first state visit to American soil in more than a decade, Trump "urged President Xi to increase production of refined petroleum products to stabilize global supply," according to a Friday White House readout. Global energy markets have faced persistent turmoil following the outbreak of the Iran war, which began with U.S. and Israeli strikes on Tehran in late February.
Iran's continued control over the vital Strait of Hormuz, an international waterway, has choked off a corridor through which roughly a fifth of the world's oil and gas supplies previously transited. Nearly seven months into the conflict, Washington and Tehran have failed to reach a peace agreement, with Trump reportedly rejecting an Iranian proposal to reopen the waterway within seven days. House Foreign Affairs Committee chairman Brian Mast, a Florida Republican, said in an interview on Fox News earlier this week that if Trump "can secure that China will stop arming Iran, who is trying to destabilize this key oil route through the globe, then the president will have done something very important for affordability, especially in terms of global crude prices, which equal prices at the pump here in the United States." Compounding the crisis, Russia, another major energy exporter, remains under Western sanctions that were imposed following its 2022 invasion of Ukraine.
Ukrainian drone and missile strikes on Russian refineries this year have slashed Moscow's diesel production by nearly 30 percent and forced cuts to foreign exports. As supply fears mounted in March, Beijing, a major producer of refined oil products, restricted its exports of gasoline and diesel to safeguard its domestic inventories. By the end of 2025, China had amassed a stockpile of nearly 1.4 billion barrels of oil, according to the U.S.
Energy Information Administration, which estimated that Beijing added an average of 1.1 million barrels of crude to its reserves daily last year. Some experts say China's government could allow more of its gasoline, diesel and jet fuel to be exported to the global market, which could ease anxieties over supplies and soften price hikes, according to RBN Energy, an analytics company known for its energy markets consultancy. Beijing relaxed its refined fuel exports in the summer, and its exports of refined oil products rose nearly 13 percent year-on-year as the Iran war continued, reported earlier this month, adding that China's jet fuel exports also hit record levels in August.
High diesel prices have hit many American households, farmers, truckers and construction businesses relying on the costly fuel particularly hard. Average diesel prices stood at nearly $6.50 a gallon early on Saturday, according to data from the American Automobile Association (AAA). This is up from just under $3.70 a gallon a year ago.
Diesel prices peaked at just shy of $6.53 a gallon on Tuesday. Gasoline prices, while still surging, haven't risen as high as diesel costs and sat at almost $4.49 a gallon on Saturday morning. Six states are currently exceeding $5 a gallon.
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