By Arathy Somasekhar
HOUSTON, Sept 29 (Reuters) – US states are taking a range of steps to curb diesel and gasoline prices that have soared in recent months due to supply disruptions stemming from the US war on Iran, Ukrainian strikes on Russia’s refineries, and dwindling global inventories.
Diesel hit a record of $6.53 a gallon a week ago, according to AAA data.
The Trump administration and Republican candidates in some of the tightest election races are looking for ways to bring down diesel prices without disrupting fuel supplies or creating additional costs elsewhere in the economy, as November’s midterm elections approach and President Donald Trump’s economic approval ratings remain under strain.
The White House is considering regulatory relief that would allow broader sales of red-dyed diesel, a move that could allow some buyers to avoid the federal fuel tax, while Trump said last week that he backed a ban on diesel exports. Red-dyed diesel is generally reserved for off-road uses such as farming and is exempt from most federal fuel taxes.
Many states have already started to take measures. Here are some of the steps states have taken so far:
Alabama: Alabama last week said it would halt the enforcement of restrictions on use of red-dyed diesel for 120 days.
California: The state on Monday suspended California’s seasonal summer-blend gasoline requirement for the remainder of the season and directed state agencies to allow winter-blend gasoline to be manufactured, imported, distributed, and sold in the state immediately.
Georgia: Georgia on Monday suspended the state gasoline and diesel tax for 30 days and suspended weight restrictions on commercial vehicles to reduce the cost of transporting goods.
Illinois: The state’s governor paused a 1.3-cent increase in the gasoline tax for six months this summer.
Indiana: The state suspended its sales tax on gasoline.
Kentucky: In May, the governor signed an executive order reducing the gasoline tax by 10 cents, freezing any increases in gasoline taxes and any increases in motor vehicle property tax in 2027.
Louisiana: The state last week said it would allow farmers and timber harvesters to use the dyed diesel fuel in highway vehicles.
Massachusetts: The governor plans to file legislation to temporarily suspend its 24-cent-per-gallon tax on gasoline and diesel for two months beginning seven days after passage. Retailers would be required to reflect the temporary suspension in prices at the pump, and gasoline station owners would be protected from losing money on fuel sold at the reduced price.
Michigan: The state’s governor temporarily waived an environmental rule, allowing regional gasoline stations to sell cheaper, higher-vapor winter blends and E15 through the summer.
Montana: The state waived certain hours-of-service rules for intrastate gasoline and diesel haulers.
Nebraska: The state allowed highway-registered vehicles to use untaxed dyed diesel fuel without facing state fines or penalties. The governor also said that diesel taxes paid while transporting Nebraska’s seasonally produced products and livestock on state roads are eligible for a refund and eased weight limits for seasonal crop transport.
Ohio: The state suspended its gas and diesel tax for 90 days.
Oklahoma: The governor paused enforcement of all taxes, regulations, and fines levied on the use of red-dyed diesel in farm vehicles and in highway vehicles for 120 days.
South Dakota: The state permitted farmers and haulers transporting crop, livestock, and other agricultural commodities to do so at up to 10% above standard highway weight limits and temporarily waived the $25 overweight trip permit fee. It also directed the department of revenue to monitor fuel supplies and determine if a tax refund to suppliers is warranted if regular diesel needs to be used in farm machinery because of potential shortages of dyed diesel.
Texas: The governor said he would expand the use of dyed diesel on Texas roads, raised the allowable weight for fuel, agricultural and timber, and suspended the state’s low-emission diesel fuel regulations to reduce emissions of nitrogen oxides from diesel-powered motor vehicles and non-road equipment.
(Reporting by Arathy Somasekhar and Georgina McCartney in Houston: Editing by Liz Hampton and Aurora Ellis)
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