NATIONWIDE — Days after President Trump signed an executive order promoting the on-highway use of red dye diesel, major fuel and trucking industry groups are warning truck stops and drivers to proceed carefully — saying the deferred taxes are still owed, the logistics are complicated, and the short-term savings may not be worth the long-term risk.
The Energy Marketers of America issued a caution to gas stations immediately after the order was signed. “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.”
The Society of Independent Gasoline Marketers of America and the National Association of Truck Stop Owners sent a joint note to their members going further. “The White House appears to be trying to encourage the supply chain to move toward selling dyed fuel in non-traditional ways. We do not expect most reputable diesel retailers and fuel marketers to do this. First, the tax is still owed, so there’s limited upside. The logistical challenges outweigh any visible upside: Residual dye lingers in tanks and fuel systems. The liability and customer risk outweigh any temporary, uncertain benefit.”
OOIDA President Todd Spencer acknowledged the order offers something, but said it falls short of what truckers actually need. “Allowing the wider use of red-dyed diesel will provide minimal relief. Market stability is essential to bring down costs for the long haul.”
The White House pushed back on the industry’s caution. Spokeswoman Taylor Rogers said the executive order “will quickly cut diesel costs and put money directly back into the pockets of American truckers, saving them over $100 every time they refill at the gas pump.” Transportation Secretary Sean Duffy, she said, will coordinate with states, industry leadership, and labor organizations to ensure access to dyed diesel.
The order defers — but does not eliminate — the federal excise tax on diesel used on highways. Only Congress can eliminate a tax. Treasury Secretary Scott Bessent has been directed to issue guidance and determine which taxpayers qualify for the deferral. The IRS is expected to announce its enforcement determination soon.
Diesel prices have surged from $3.76 per gallon to $6.32 since the war with Iran began earlier this year — a nearly 70% increase. The Ukraine-Russia conflict has compounded the problem, with Russian diesel exports curtailed through at least the end of October following Ukrainian drone strikes on Russian refineries. Brent crude oil was trading above $101 per barrel Tuesday night, up more than 66% since the start of the year.
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