Fuel industry warns truck stops not to sell red dye diesel after Trump lifts restrictions

Truck stops nationwide were warned to “proceed with caution” Tuesday by a major industry group after President Donald Trump signed an executive order to promote the use of red dye diesel fuel.Red dye diesel is exempt from federal excise taxes because it is intended for farm equipment and other off-road uses.The order, signed before farmers in Nebraska on Monday night, aims to bring down fuel prices by “temporarily” allowing highway use of red-dye diesel fuel, according to a White House statement. U.S. voters are deeply frustrated by the high price of gas, and the Trump administration is under intense pressure to bring down fuel costs before the Nov. 3 midterm elections.Monday’s order instructs Treasury Secretary Scott Bessent to “defer certain diesel fuel tax payment obligations and to provide penalty relief to the extent permitted by law.” It does not waive the federal taxes because only Congress can eliminate a tax.Following Trump’s directive, the Energy Marketers of America warned gas stations to “proceed with caution.”“Whether relief is available, whom it covers, and on what conditions depend on Treasury determinations and guidance not yet issued,” the group said. “Deferral is not forgiveness.”Moreover, the order does not “resolve EPA or state restrictions” on the dyed variety of diesel fuel, the EMA said. Other trucking and gas industry groups sounded a similar note of caution.“The White House appears to be trying to encourage the supply chain to move toward selling dyed fuel in non-traditional ways,” the Society of Independent Gasoline Marketers of America and National Association of Truck Stop Owners said in a note to their members.“We do not expect most reputable diesel retailers and fuel marketers to do this,” they said. “First, the tax is still owed, so there’s limited upside.” Additionally, “the logistical challenges outweigh any visible upside: Residual dye lingers in tanks and fuel systems.”For most fuel sellers, “the liability and customer risk outweigh any temporary, uncertain benefit.”The White House did not immediately reply to a request for comment. Despite an executive order promoting red dye diesel, trucking and fuel industry groups are warning their members it may not be worth the risk.Clayton Steward / Bloomberg via GettyA group representing independent long haul truckers also suggested Trump’s move would provide little benefit to its members.“Allowing the wider use of red-dyed diesel will provide minimal relief. Market stability is essential to bring down costs for the long haul,” said Todd Spencer, president of the Owner-Operator Independent Drivers Association.Since the war with Iran began, the price of diesel has surged from $3.76 per gallon to $6.32 as of Tuesday, a nearly 70% increase.The Iran conflict is not the only conflict contributing to diesel’s skyrocketing price. A recent escalation of the Ukraine-Russia war has included strikes by Ukrainian drones on Russian refineries. Traditionally one of the world’s large diesel exporters, Russia has responded to the attacks by imposing a diesel export ban through at least the end of October.Trump has urged Ukrainian President Volodymr Zelenskyy to halt strikes on Russia’s diesel infrastructure.“Mr. Zelenskyy has to do one thing. He has to stop knocking out diesel fuel in Russia,” Trump told reporters in early September. “There are plenty of other targets. Don’t hit diesel fuel, because that’s hurting the world.”Oil prices also remain sharply elevated since the beginning of the year. Brent crude oil, which on Tuesday night traded above $101 per barrel, is up more than 66% since the start of the year.