U.S. President Donald Trump on Monday ordered expanded access to the tax-exempt, dyed diesel fuel typically used to power heavy agricultural and construction equipment operated off public roads.
At a campaign rally Monday night in Grand Island, Nebraska, the president directed U.S. Agriculture Secretary Brooke Rollins to “ensure farmers’ access to dyed diesel in high-demand areas.” Trump also instructed Transportation Secretary Sean Duffy to work with states, labor organizations and fuel distributors to increase access to dyed diesel, which is typically colored red.
Trump’s order temporarily waives tax penalties on using dyed diesel on public highways, which normally start at a minimum of $1,000, until Dec. 31. Under the president’s directive, the Internal Revenue Service will also waive through Dec. 31 the 24.4-cent-per-gallon federal excise tax charged on purchases of on-highway diesel fuel, which is undyed.
Signing the executive order on stage at the campaign rally alongside Nebraska Gov. Jim Pillen and U.S. Sen. Pete Ricketts, Trump said expanding the supply of diesel fuel will help to control inflation.
The average U.S. price on Monday for a gallon of on-highway diesel fuel was $6.32, down from a record-high $6.53 on Sept. 21. Global oil market disruptions caused by the Russia-Ukraine and U.S.-Iran conflicts and low domestic inventories have led to a near doubling of diesel fuel prices along U.S. highways.
“The typical trucker will save more than $100 every time they fill up,” Trump told the crowd. The president said the waiver will “save farmers millions of dollars and drive down the cost of goods.”
Ricketts and the governors of nine other states – Alabama, Arkansas, Indiana, Louisiana, Missouri, North Carolina, North Dakota, Oklahoma and Texas – ordered the temporary suspension of state-level penalties for the use of dyed diesel before the president’s directive.
The governors of Iowa, South Dakota and Tennessee issued orders Tuesday that suspend penalties for use of the dyed fuel on state highways.
Texas Gov. Greg Abbott last week declared a statewide fuel emergency as he ordered a temporary suspension of penalties on farmers and all commercial motor vehicles using tax-exempt, off-road fuel on public highways.
Louisiana Gov. Jeff Landry was the first state executive to declare a fuel emergency. On Sept. 22, the Louisiana governor suspended restrictions on use of dyed diesel by farmers and loggers in his state.
“I declared a State of Emergency so our farmers could use the dyed diesel fuel they already had on hand-and now, thanks to YOU, that relief is going nationwide! This is a HUGE WIN for America’s farmers, truckers, and hardworking families,” Landry posted on Monday on social media site X.
