Trump administration urges states to allow on-road dyed diesel

U.S. Secretary of Agriculture Brooke Rollins said Tuesday in Iowa that she is urging state governors to follow the president’s move to suspend penalties on the unrestricted use of dyed diesel, a tax-exempt fuel typically allowed in off-road machinery only.

President Donald Trump announced Monday evening at a rally in Nebraska he would authorize highway use of dyed diesel fuel and defer the federal excise tax on the fuel to provide relief from the steep diesel prices which have hit record highs of more than $6 per gallon, nationally.

The move from Trump followed actions from several states, like Ohio, to suspend state fuel taxes or to allow dyed diesel fuel. After Trump’s Monday-night executive order, more states, including Iowa, have leveraged similar state-level suspensions.

Rollins, speaking with reporters at a stop in Iowa Tuesday, said she is “on the phone constantly with other governors, trying to get them to do the same.”

Rollins said 13 governors, including Democratic Gov. Josh Stein in North Carolina, have followed suit.

“I’m working on a lot of the other Democrat governors, saying … this will really help your constituents and your farmers.”

According to the executive order from the president, the federal suspension could save drivers as much as $100 per trip to the fuel station.

In his announcement Monday evening, Trump said the order would allow “anyone” to purchase red-dyed diesel fuel “for any reason.” Trump’s executive order runs through the end of the calendar year.

Rollins said Tuesday that in addition to the executive order on dyed diesel, an influx of 100 million barrels of oil from the Group of Seven, or G7, countries have “already” caused the price of diesel to decline. The G7 announcement was made Friday. According to AAA fuel price data, the national average price of diesel was about $0.13 per gallon lower Tuesday than a week prior.

“There’s a lot of really good things that are being deployed right now,” Rollins said.

Fuel prices have risen sharply due to the ongoing war in Iran and closures in the Strait of Hormuz, a prominent trade route for products like oil and fertilizer, combined with continued conflict between Russia and Ukraine.

In his rally speech in Nebraska, Trump said the situation in Iran is “going to be over with very soon.” Rollins echoed the sentiment Tuesday when asked about the war and said the government of Iran “cannot have” a nuclear weapon and that the war was “so important for the future.”

“He has said that we’re moving quickly, that we will and should be out of it very soon,” Rollins said. “When that happens, all of the fuel prices, everything will absolutely go down significantly.”

Rollins said the current situation “is exactly why” the administration is “working so hard” to increase domestic energy production.

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