US President Donald Trump has signed an executive order temporarily expanding access to tax-exempt, red-dyed diesel for highway use as his administration seeks to reduce fuel costs for American truckers and farmers.
The order, signed on Monday, allows the temporary use of off-road dyed diesel on public roads and defers the applicable federal excise tax through the end of 2026.
Trump announced the measure during a rally in Grand Island, Nebraska, as his administration faces pressure over rising energy and living costs ahead of the November midterm elections.
The White House said the measure was designed to lower diesel costs for truckers, farmers and other users of the fuel.
Dyed diesel is normally sold without the federal and applicable state excise taxes imposed on fuel intended for on-road use. Its use on public highways has traditionally been restricted.
Under the executive order, the Treasury Department is directed to defer payment of the federal excise tax applicable to highway use of dyed diesel for the remainder of the year, without interest or penalties.
The administration has framed the measure as an immediate response to elevated diesel costs, while critics and analysts are expected to assess its potential impact on tax revenues, fuel markets and enforcement.