Oil industry pushes back against Trump administration plan
Energy Secretary Chris Wright said Wednesday that the Trump administration would implement voluntary restrictions on diesel exports rather than an outright ban, signaling a softer approach than the one President Trump floated a day earlier.
In an interview with the Journal House at the United Nations General Assembly, Wright said the administration would not stop all diesel exports. He said the administration has to keep the world supplied with diesel but needs to change the trajectory of prices in the United States — and the plan would be voluntary.
“We’re trying to avoid a blunt hammer of a government policy, understanding the complexity of refining,” Wright said.
Trump said Tuesday that the administration was considering restricting diesel exports, sending the oil-and-gas industry scrambling. Industry groups had warned that an export ban risked creating a cascade of unintended consequences that would throttle supplies of diesel and gasoline in the United States and lead to spiking prices.
The American Exploration & Production Council said Wednesday that “policymakers should reject this short-sighted approach and instead focus on solutions that will actually lower prices at the pump.”
Wright’s description of how the voluntary restrictions would work was light on details and is set to raise new questions. Some industry lobbyists noted that discussing restrictions amongst refiners could potentially violate antitrust laws.
Ben Cahill, a nonresident senior fellow at the Atlantic Council, said it might be easier for the administration to eventually lift a cap on exports than a ban, which risks being stickier because undoing it would lift a swift — and unpopular — rebound in diesel prices.
“I think it makes it easier to explain what you’re doing,” Cahill said.
Industry trade groups have spoken out against potential restrictions in their most forceful stand against the administration since Trump’s return to the White House.