UK Engages with EU on Diesel Reserves Amid US Export Threat

Donald Trump has indicated he may request European countries to release some of their diesel reserves as he considers a ban on US exports of the fuel due to a global shortage. His comments followed Treasury Secretary Scott Bessent's call for Europe to prepare and release such supplies immediately to alleviate the burden on American farmers, truckers, and businesses facing rising prices. The US has threatened to restrict diesel exports amid increasing costs attributed to the ongoing conflict in Iran. This issue is significant for US voters ahead of the midterm elections. On Thursday, the UK held discussions with European partners regarding the potential release of diesel reserves in response to any US export ban. The US is a critical supplier of diesel, exporting between 1.2 and 1.5 million barrels per day, and experts warn that a ban could further strain prices in other countries. Trump stated, "We're thinking about it very seriously" regarding the export ban. Bessent emphasized the need for European partners to expedite the delivery of existing commitments and make additional supplies available to address ongoing disruptions. Diesel prices in the UK reached record highs this week, nearing 200p per litre, according to the RAC. Britain's Energy Minister Martin McCluskey participated in a call with European counterparts to discuss the potential ban. A source familiar with the discussions indicated that it was prudent to prepare a coordinated response with other countries, noting that European reserves remain from a previous coordinated release of strategic fuel stocks. A government spokesperson reassured that there is no cause for concern about potential diesel shortages, although prices are expected to rise further. A European Commission spokesperson mentioned ongoing discussions with high-level contacts in the US administration regarding the diesel situation. Global petrol and diesel prices have surged since the onset of the US-Israel conflict in Iran in February, compounded by the closure of the Strait of Hormuz, a critical route for oil and gas transport. An export ban from Russia, another major diesel supplier, has also contributed to rising prices. Trump has argued that retaining surplus diesel in the US would lower domestic pump prices, providing immediate relief ahead of the midterm elections. However, David Fyfe, chief economist at Argus Media, warned that cutting off American supply could lead to a significant increase in international prices. The latest RAC figures show UK diesel prices at an all-time high of 199.79p per litre, up from 142.38p. Diesel is more challenging to refine than gasoline and is essential for the haulage industry and agriculture, making demand reduction difficult. The UK relies heavily on imports, as its four refineries produce sufficient petrol but not enough diesel to meet national needs. As of June, there were 15.1 million diesel vehicles on UK roads, a decrease from 15.7 million the previous year, with diesel cars dropping from 10.4 million to 9.8 million.