red dye – Industry groups are warning fuel retailers to avoid selling red-dye diesel despite a new executive order from President Trump aimed at lowering prices.
The directive arrived late Monday night. signed before a crowd of farmers in Nebraska: a promise to bring relief to Americans crushed by rising fuel costs by temporarily opening the highway to “red dye” diesel. By Tuesday. however. the industry that actually moves the fuel was signaling that the President’s order might be a logistical dead end.
The Energy Marketers of America issued a stark warning to truck stops across the country: “proceed with caution.” While the executive order instructs Treasury Secretary Scott Bessent to provide penalty relief and defer tax payments. it stops short of an outright tax waiver. which only Congress has the power to enact. For the retailers on the ground, the math simply does not add up. The Society of Independent Gasoline Marketers of America and the National Association of Truck Stop Owners cautioned members that “deferral is not forgiveness. ” noting that the tax liability remains.
The friction between the White House and the industry centers on the reality of the fuel supply chain. Red dye diesel is traditionally exempt from federal excise taxes precisely because it is reserved for off-road use. such as farm equipment. Retailers point out that beyond the legal tax obligations, there are severe practical hurdles. Residual dye lingers in tanks and fuel systems. creating liability and customer risks that most reputable marketers are unwilling to absorb for an uncertain. temporary benefit.
This policy push comes as the administration faces immense pressure to lower costs ahead of the November 3 midterm elections. Diesel prices have surged nearly 70% since the start of the conflict with Iran. climbing from $3.76 to $6.32 per gallon as of Tuesday. Global supply constraints have only tightened the squeeze: the Ukraine-Russia war has prompted Ukrainian drone strikes on Russian refineries. leading Moscow to impose a diesel export ban that will last through at least the end of October. Brent crude oil now trades above $101 per barrel, a 66% increase since the beginning of the year.
In early September, President Trump publicly urged Ukrainian President Volodymyr Zelenskyy to stop hitting Russia’s diesel infrastructure. “Mr. Zelenskyy has to do one thing,” Trump told reporters. “He has to stop knocking out diesel fuel in Russia. There are plenty of other targets. Don’t hit diesel fuel, because that’s hurting the world.”.
Despite the White House’s attempt to pivot the supply chain, those behind the wheel remain skeptical. Todd Spencer. president of the Owner-Operator Independent Drivers Association. which represents independent long-haul truckers. flatly stated that the move would offer only “minimal relief.” For those working the roads. the promise of red dye fuel does little to mask the volatility of a market that has seen prices rise by nearly $2.56 a gallon in recent months. The White House did not immediately reply to a request for comment.
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