States are taking emergency steps to ease record-high diesel prices caused by conflicts abroad as the White House continues to weigh its own measures.
Texas and Georgia announced emergency measures Monday aimed at reducing diesel prices, which affect the transportation and agricultural sectors. Diesel prices have reached record highs in recent weeks due to conflicts in the Middle East and Ukraine.
In Texas, Republican Gov. Greg Abbott declared a 30-day statewide disaster, expanding the use of dyed diesel, raising the allowable weight for fuel, and suspending some federal diesel emission rules. Dyed diesel is typically reserved for off-road uses, such as farming, and is generally exempt from federal fuel taxes.
“Texas agriculture and freight run on diesel,” Abbott said in a press release.
“Record prices put both industries at risk and raise costs for every Texas family. Farmers and truckers can now use dyed diesel on Texas roads, and fuel, crop, and timber loads can move at a higher weight. These steps cut costs on the farm, on the road, and at the store,” he added.
Javier Blas, an energy and commodities columnist at Bloomberg, said on X that Texas’s measure allowing truckers to use dyed diesel could save them 24.4 cents per gallon in federal excise taxes, plus another 20 cents per gallon in Texas state taxes.
He noted that the measure doesn’t lower diesel costs to farmers as they already have access to untaxed dyed diesel.
Abbott has also requested that the Environmental Protection Agency waive federal ultra-low sulfur diesel requirements. The average price for diesel in Texas is currently $5.84 per gallon.
Georgia has also declared a state of emergency, where Republican Gov. Brian Kemp suspended the fuel tax for 30 days. Kemp also suspended the state’s weight limits on commercial vehicles.
The state’s current motor fuel excise tax is 33.3 cents per gallon for gasoline and 37.3 cents per gallon for diesel. The tax suspension is set to take effect on Tuesday. Georgia’s average price for diesel is at $6.23 per gallon, while the gasoline price is $4.17 a gallon.
Louisiana was one of the first states to take action on addressing high diesel prices. Last week, Gov. Jeff Landry (R-LA) declared a state of emergency to allow farmers and timber harvesters to use dyed diesel they have on hand to help curb prices.
The states’ actions come as the White House is considering its options to ease diesel prices ahead of the November midterm elections.
President Donald Trump last week called for a ban on diesel exports to ease prices.
However, the administration has been split over imposing an export ban. Energy Secretary Chris Wright has argued that a ban could push fuel prices higher.
In recent days, it has been reported that the administration is considering alternatives, including allowing for the broader sales of red-dyed diesel. The administration has also asked major refineries to commit voluntarily to limiting diesel exports and may encourage states to eliminate excise taxes on diesel.
Reuters reported on Tuesday that the White House has asked the European Union to release emergency diesel from its inventories to lower global prices.
TRUMP ENDORSES DIESEL EXPORT BAN AS GOP FRETS OVER HIGH PRICES
The wars in the Middle East and Ukraine have elevated diesel prices.
For instance, in Iran, shipments of fuel flowing through the key trading waterway, the Strait of Hormuz, have been at a standstill. Russia has also played a role in sending fuel prices up as it has stopped exporting diesel through October. Ukrainian drone strikes have also damaged Russian refineries.
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[ H/T Washington Examiner ]
