As the U.S. midterm elections approach, the increasing diesel prices are putting growing pressure on the Trump administration.
According to Reuters reported on September 30, two sources said that in order to lower global diesel prices and alleviate fuel costs before the mid-term elections in November, Trump and his administration are considering various measures, including urging the EU to use emergency diesel reserves.
According to sources, the White House is dissatisfied with some European countries for not fulfilling their promises made earlier this year to use emergency oil and refined oil reserves to address supply disruptions and price increases caused by conflicts in Iran and shipping obstacles in the Strait of Hormuz.
According to sources, U.S. officials are particularly dissatisfied with France and Germany, believing that both countries have not fulfilled their previous commitments regarding the release of reserves. The U.S. has also expressed concerns to the International Energy Agency, which is responsible for coordinating the release of emergency oil reserves by member countries.
According to a latest report by Reuters on October 1st, three people familiar with the discussions said that the Trump administration has asked Germany and France to use their emergency diesel inventories to help alleviate global fuel price pressures. Otherwise, the United States may impose a ban on diesel exports.
An EU official told Reuters that the European Commission, along with Germany, France, Italy, Ireland, and the UK, will hold a teleconference on Thursday to discuss whether it is necessary to release diesel reserves.
Another source located in the capital of a European country said that the United States has requested the European Union to release 120 million barrels of diesel within the next six months.
On September 9 local time, in Newtown, Pennsylvania, USA, there was a sticker attached to the price tag of gasoline and diesel at a gas station. The sticker featured a picture of Trump and read “It’s me!” Visual China
To address the global oil supply shortages caused by the conflict in Iran, 32 member states of the International Energy Agency agreed to release 400 million barrels of strategic oil reserves in March this year. The United States pledged to release 172 million barrels. EU countries agreed to jointly bear 20% of the released reserves.
On September 29th, the Strategic Petroleum Reserve Program Management Office of the U.S. Department of Energy issued a statement indicating a plan to release 40 million barrels of crude oil into the market through an “exchange” mechanism. This batch of crude oil is also part of the United States’ commitment to release 172 million barrels.
On the 29th, U.S. Energy Secretary Chris Rieber announced that the United States would release its oil reserves again. He also publicly urged European countries to fulfill their commitments. He said that both the United States and Japan are fulfilling their respective promises, but “several European members have only released a small portion of the crude oil and petroleum products they had promised earlier.”
EU Energy Commissioner Daniele Schifani stated on September 29 that the EU has discussed with the Executive Director of the International Energy Agency, Fatih Birolde, whether to further release emergency oil reserves, but has not yet decided whether to request actions from member states.
The European Union has not yet announced the total amount of reserves that each member country has released so far. However, the International Energy Agency indicates that the contributions from EU countries will mainly come in the form of refined oil products rather than crude oil.
According to data from the American Automobile Association (AAA), gasoline prices in the United States have increased by more than 40% over the past year, and diesel prices reached a record high of $6.53 per gallon last week.
Diesel fuel is crucial for agriculture, truck transportation, and manufacturing. The soaring prices of diesel have become a major political pressure on Trump and the Republican Party, especially in agricultural states. Currently, the Trump administration is considering various measures to lower diesel prices, including pressuring other countries to release their reserves, restricting U.S. diesel exports, and working with oil companies to increase domestic supply.
Trump said on September 30 that he “daily” discusses the possibility of banning diesel exports. Banning diesel exports could have “negative effects” on gasoline prices, but it would help lower diesel prices.
Trump believes that the Russia-Ukraine conflict and the attacks on energy facilities by both sides have affected energy production and exports, which is the main reason for the rise in diesel prices. “We think we are in a very good position right now,” said Trump.
The United States and Russia are the world's largest and second-largest diesel oil exporters, respectively. In order to alleviate the shortage of fuel supply in their countries and stabilize the market, the Russian government announced on July 8 that diesel oil exports would be prohibited from the current date until July 31.
According to TASS, on September 30, the Russian government announced that the ban on the export of diesel fuel, marine fuel, and kerosene to fuel producers would be extended for another month, until the end of October. The Russian side stated that this measure is intended to maintain stability in the domestic fuel market, especially given the increased demand for vehicle fuel during the autumn harvest season.
On September 13th, Trump appealed to Ukrainian President Zelenskyy, asking him to stop attacking Russian diesel facilities, claiming that these attacks were causing a fuel shortage.
"Mr. Zelenskyy must do one thing. He must stop destroying Russia's diesel facilities... He can target other targets, but not the diesel facilities, as they are causing a diesel shortage," said Trump.
