By Haris Saleem — SCN News
LONDON — Britain is pressing the United States over possible restrictions on American diesel exports and preparing emergency supply measures at home, as record fuel prices leave the UK particularly exposed to any move by President Donald Trump to hold more diesel inside the United States.
Chancellor John Healey said on Monday that the British government was in talks with U.S. authorities over the threatened restrictions and was making preparations in case Washington moves ahead. Britain imports more than half the diesel it consumes and roughly a third of those imports come from the United States, making the country one of the European economies directly exposed to a disruption in American supply.
“We work very closely with the Americans,” Healey told BBC News on the sidelines of the Labour Party conference in Liverpool. He said Britain was also making provisions it might need and pointed to domestic fuel stocks, while arguing that a diplomatic settlement to the conflict with Iran would provide the most effective route to easing pressure on global energy markets.
The intervention comes as British diesel prices reached a record 199.18 pence a litre on Monday, according to motoring organisation RAC, surpassing the previous peak reached during the energy shock following Russia's full-scale invasion of Ukraine. Filling an average family car with diesel now costs almost £110, about £31 more than before the Iran conflict began.
Trump has publicly backed keeping more American diesel at home as his administration searches for ways to bring down record U.S. fuel costs. Speaking last week at the United Nations, Trump said he had called within his administration for the United States to stop sending diesel abroad, while Treasury Secretary Scott Bessent said officials were examining whether restrictions were feasible and whether a full or partial measure could work.
The precise U.S. policy, however, remains unsettled. A White House official last week denied a report that the administration was preparing a blanket 90-day export ban, while Energy Secretary Chris Wright said nobody was considering a flat prohibition and that officials were examining other ways of getting more diesel into the domestic market without reducing supplies of gasoline and jet fuel.
That distinction is important for Britain because even partial restrictions could tighten an already stressed European diesel market. Europe has become more reliant on American refined fuel as the wars involving Iran and Ukraine have disrupted supplies from other major producers, while restrictions on Russian energy have further altered traditional supply routes.
The European Union has also been lobbying Washington against restrictions. European Commission officials warned last week that curbing American diesel exports could hurt both sides of the Atlantic, while EU Energy Commissioner Dan Jørgensen has urged Washington to maintain the free flow of energy between Europe and the United States as winter approaches.
Britain's dependence is particularly significant because the country no longer produces enough diesel domestically to satisfy demand. Imported diesel is essential to road freight, agriculture, construction and other parts of the economy, meaning a sharp increase in wholesale prices can move beyond motorists relatively quickly and feed into transport and distribution costs.
The latest price surge is already creating that pressure. Diesel is extensively used by trucks and commercial fleets carrying food and other goods across Britain, while agricultural machinery and construction equipment also rely heavily on the fuel. Higher diesel costs can therefore increase business expenses and add to inflation at a time when British households are already facing prolonged cost-of-living pressure.
The UK government's discussions with Washington have consequently become more urgent as Trump continues to leave the export option open. Trump said over the weekend that his administration was considering the idea “very seriously,” according to the BBC report, keeping alive the possibility of restrictions even after White House officials pushed back against reports of a blanket 90-day prohibition.
Trump is facing similar pressure at home. U.S. diesel prices climbed above $6.50 a gallon last week, around 76% higher than a year earlier, as disruptions linked to the Iran and Ukraine wars tightened global supplies. Republican lawmakers representing agricultural areas have pushed for action because high diesel prices are hitting farmers and truckers ahead of the November midterm elections.
But Trump's own energy secretary has publicly questioned whether restricting exports would solve the problem. Wright warned that if American refiners could not export surplus diesel, storage capacity could fill and force them to reduce refinery runs. Because refineries simultaneously produce diesel, gasoline and jet fuel, lower operating rates could ultimately reduce supplies of those other fuels and push their prices higher.
The American Petroleum Institute and other industry representatives have raised similar concerns, arguing that restricting international sales could disrupt refinery operations and distort fuel markets rather than provide sustained relief to American motorists. U.S. officials have therefore also considered partial or voluntary measures instead of a blanket export prohibition.
The volumes involved are substantial. The United States has become one of the world's biggest suppliers of refined petroleum products, and its distillate exports have risen sharply during the current global supply crunch. Europe, Mexico and Latin American markets are among the major destinations, meaning any significant U.S. restriction would redistribute rather than eliminate demand for diesel across the international market.
Europe's exposure has increased as other sources have become less reliable. Russia's war in Ukraine and restrictions on Russian products have already reshaped European fuel supply, while the conflict involving Iran has disrupted production and transportation across the Middle East. Europe imported nearly 506,000 barr
Britain is now confronting those pressures directly at filling stations. The RAC said Monday's 199.18-pence average had moved diesel prices into unprecedented territory, while petrol was also rising and stood at 174.13 pence a litre. The organisation said the increase demonstrated how vulnerable Britain remains to disruptions originating far beyond its borders.
Healey linked the immediate fuel problem to the wider Middle East conflict, saying a settlement there was ultimately needed to ease costs on businesses and households. The Iran war has disrupted oil production and transportation for seven months, while uncertainty surrounding the Strait of Hormuz has remained a major source of volatility in global energy markets.
The fuel-price surge also lands ahead of Healey's Oct. 28 budget. Britain's existing freeze on fuel duty is scheduled to expire at the end of the year, with duty currently due to rise by three pence in January and another two pence in March. Healey described current diesel prices as “extreme” but did not announce a new tax measure on Monday.
London's immediate effort is therefore focused on Washington as well as domestic contingency planning. The government is trying to prevent a U.S. supply restriction while preparing to draw on available stocks and other arrangements if American exports are curtailed.
Washington, meanwhile, has yet to announce a final policy. Trump continues to support the idea of keeping additional diesel in the United States, while senior administration officials and the energy industry have warned that a blanket ban could produce unintended consequences for American gasoline and jet-fuel supplies.
For Britain, the decision could come at an especially difficult moment. Diesel prices have already surpassed their 2022 record before any new U.S. restriction has taken effect, and the UK remains heavily dependent on imports to satisfy domestic demand. The British government is now lobbying Washington while preparing for the possibility that one of its largest overseas diesel suppliers could nevertheless reduce shipments.