US President Donald Trump signed an executive order on October 5 to expand access to tax-exempt diesel, allowing consumers to purchase so-called “red dye” diesel without the federal taxes typically applied to on-road fuel.

Trump signed the order during a rally in Nebraska, saying the directive would waive the existing off-road-use requirement for red-dyed diesel and broaden access to the tax-exempt fuel.

Red-dyed diesel is generally designated for off-road uses, such as agricultural and industrial equipment, and is subject to different tax treatment from diesel used on public roads.

The development comes after US President Donald Trump backed a potential ban on diesel exports as fuel prices reached record highs, calling for more diesel to be retained in the domestic market. Trump has argued that the US produces significant volumes of the fuel and should prioritize domestic supplies.

The proposal has faced opposition from the European Union, which on October 2 said it “fully rejects” any US diesel export ban, warning that such a move would not benefit either side and could undermine trust in the US as a reliable energy partner. The EU is heavily reliant on US diesel imports, making any disruption a potential threat to fuel supplies and prices.

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