The United States is ‘very seriously’ considering a 90-day ban on diesel exports ahead of the November midterm elections. Prices have shot to record highs in Europe and the US as multiple wars rage across the world, becoming a massive issue for poll-bound Republicans. The announcement also came mere days after President Donald Trump signed legislation allowing up to 100% tariff on India and other buyers of Russian energy — potentially creating a major headache for European nations.
According to Kpler data, the US supplied 420,000 barrels of diesel to EU member countries and the UK last month. The figure accounts for more than half of its monthly imports and highlights a sharp surge since the Strait of Hormuz closure. Data released by Vortexa in early September also reveals a growing dependence on diesel supplies from India — making up 60% of the fuel transiting the strategic Bab-el-Mandeb route in August.
European nations have reacted with “concern” after Trump floated the idea of preventing diesel from reaching global markets. The continent is now heading into peak winter demand with diesel inventories at a record low — heavily dependent on the US and India after the US-Israeli war against Iran disrupted Middle East supply chains.
A short term US diesel export ban in tandem with hefty sanctions against buyers of Russian oil could create an impossible situation for the region.
US mulls diesel export ban
According to figures shared by motorist advocacy group AAA, average US diesel prices have risen at least 76% year-on-year to $6.52 a gallon. The surge comes at an uncomfortable time for Trump and other Republicans as they seek to maintain narrow control of both chambers of Congress in the November 3 elections.
But a plan to ban diesel exports for 90-days has left US officials divided ahead of polls. Trump told a Fox News reporter on Sunday that his administration was “thinking about it very seriously” — mere days after signing legislation to sanction countries buying Russian energy. It is pertinent to note here that the war against Ukraine (and Trump’s failed attempts to end over four years of fighting) also matters to many Republican lawmakers, activists, and voters.
“I’ve said let’s not send out the diesel. We make a lot of diesel… I’ve called for it. I’ve called for it within my people…That can oftentimes lead to a little bit of an increase on gasoline for cars, so we’re looking at it very seriously. We may do it,” Trump had insisted at different times recently.
No timeframe or details have been announced so far, and at least some members of his Cabinet have gone on record opposing the move. US Energy Secretary Chris Wright said last Wednesday that a curb would not work and could push up gasoline and jet fuel prices. Meanwhile US Interior Secretary Doug Burgum said last week that such a ban could lead to retaliatory action from countries that export fuel to the US.
“The blunt tool of banning diesel exports definitely doesn’t work. If you can’t export the diesel that comes out of our refineries, you run out of places to store it, and you have to reduce US refining, which would put upward pressure on gasoline prices and jet fuel prices,” Reuters quoted Wright as saying during an event.
Tariffs against Russian energy purchase
The debate follows a bipartisan vote to sanction countries buying oil from Russia that was signed recently into law by Trump. The Lindsey O Graham Sanctioning Russia and Iran Act allows the President to impose sweeping sanctions on Russia and impose additional tariffs on countries breaking the oil embargo. The new law allows the President to decide which countries will face tariffs and the relevant rates as well as possible waivers. Buyers of Russian energy (such as India) can face up to 100% tariffs once the new legislation comes into effect within 30 days of signing by the President.
“India remains firmly committed to ensuring energy security for its 1.4 billion people. It will continue to do so through diversified sourcing and on the basis of evolving market dynamics. This issue has been discussed at high levels in recent months with various US interlocutors. Its potential implications for not just the bilateral relationship but also the international energy market have been very clearly articulated by the Indian side,” the Ministry of External Affairs said in a recent statement.
Indian import of Russian crude has surged to record highs this year — reaching 2.6 million bpd in June. Data from trade sources cited by Reuters showed shipments from the country made up 50.83% of imports by the third-biggest oil buyer and consumer. July imports of Russian oil were up 62.4% from a year earlier at 2.47 million barrels per day.
The Russian share in Indian oil imports fell slightly in August while supplies from the Middle East increased as Abu Dhabi National Oil Co sold oil from the region from outside the Strait of Hormuz. Moscow remained the top supplier even as imports fell 16.5% in August from the previous month to about 2.1 million barrels per day. Preliminary data from Kpler suggests India’s Russian oil imports will decline to 1.9 million bpd in September.
India ramps up fuel exports
The Commerce Ministry also told Parliament in August that export of petroleum products had increased 67.64% from $4.13 billion in July 2025 to $6.92 billion a year later. India reported a sharp increase in exports (merchandise and services combined) between April 2026 and July 2027 — rising 13.16% year-on-year to $316.42 billion. Petroleum products led the list as the primary driver of merchandise exports. According to a PIB press note, the cumulative value of merchandise exports during this period was $173.78 billion.
Import costs have also surged during this time — with India’s crude oil bill rising 56.5% year-on-year to $63.4 billion — despite volumes remaining largely unchanged in April-July this year. Growing geopolitical instability has led to a surge in global crude oil prices, combined with shipping disruptions and escalating freight rates and war-risk insurance costs as the West Asia conflict continues.
Monthly data from the Petroleum Planning & Analysis Cell highlighted a degrowth of 3.0% and 0.4% in crude oil imports during August 2026 and April-August FY 2026-27 respectively. The net import bill for oil and Gas remained unchanged from the previous year at $9.3 billion in August 2026.
“Crude oil imports constituted $11.7 billion, LNG imports $1.2 billion and the exports were $5 billion during August 2026. The price of Brent Crude averaged $90.84/bbl during August 2026 as against 83.41/bbl during July 2026 and 68.21/bbl during August 2025. The Indian basket crude price averaged $90.19/bbl during August 2026 as against $82.04/bbl during July 2026 and $69.11/bbl during August 2025,” the PPAC monthly report added.
The Indian government has repeatedly framed its purchase of Russian oil as a matter of national interest and economic survival. Russian Deputy Foreign Minister Andrey Rudenko also contended recently that the discounted crude had helped cushion India from an oil-supply shock after war disrupted energy flow through the Strait of Hormuz.
Deepening crisis for Europe
Large swathes of Europe pivoted away from Russian oil after the Ukraine war broke out in February 2022. The EU has seen crude imports from the country drop from 27% to less than 3% during this time amid strict seaborne embargoes, a G7-led price cap, and the introduction of a REPowerEU strategy. In December last year, the European Union also agreed to phase out Russian gas imports by late 2027 as part of an effort to end the bloc’s decades-long dependency on Russian energy.
The United States had replaced Moscow as Europe’s top crude oil supplier by March 2023 — with many countries completely rewriting the global energy map to replace millions of barrels of Russian oil. West Asia had also become another major pillar of this new energy strategy — especially when it came to processed fuels like diesel. The US-Israeli war with Iran and subsequent blockade of the Strait of Hormuz therefore came as a significant blow for the continent.
Recent data from Vortexa reveals India became a key diesel supplier for Europe in August — accounting for 60% of the fuel transiting the strategic Bab-el-Mandeb route. US exports to the continent reportedly peaked near 540kbd in the first half of August before falling to 350kbd during the second half, a drop of 35% in just a few weeks. And while India holds a clear lead at present, experts predict a sharp drop as refineries run low on crude oil stocks.
“Europe’s next few months’ worth of diesel supply therefore depends on an array of unstable sources, while low inventories and an upcoming turnaround season just worsen the pressure,” the Vortexa analysis warned.
Can the US impose 100% sanctions on India?
European leaders have already approached the Trump administration to register their protest against a possible diesel ban. Many remain skeptical about the possibility — with Irish Energy Minister Darragh O’Brien telling reporters that the threat “doesn’t look like … something that would happen.”
“The European Union views with concern the report that the US plans to ban diesel exports, including to the European Union. Any disruption would risk negatively impacting both sides,” multiple publications quoted European Commission spokesperson Olof Gill as telling reporters.
Any such ban gains additional significance in light of the Russia Sanctions Act. A 100% tariff against the country (the maximum allowed under the new law) would create severe strain for India and possibly impact European imports if New Delhi is forced to pivot.