Trump Administration Plans to Allow Dyed Diesel for On-Road Use to Cut Costs

Key Facts

1The Trump administration plans to allow the use of tax-exempt dyed diesel in on-road vehicles to mitigate high fuel costs.

2The move would save 24 cents per gallon as the fuel is exempt from federal excise taxes.

The Trump administration plans to allow the use of tax-exempt dyed diesel in on-road vehicles to mitigate high fuel costs. According to Bloomberg, the move is designed to provide relief from global refining disruptions, offering a saving of 24 cents per gallon as this fuel type is exempt from federal excise taxes.

The policy shift follows near-record US diesel prices driven by refining disruptions linked to the Ukraine-Russia conflict and Middle East tensions. While red diesel is typically reserved for off-road machinery like tractors and construction equipment, the administration intends to expand its use to pickup trucks and other on-road vehicles to lower industrial and logistics expenses.