Diesel futures rise as Russian supply plan faces doubts

U.S. diesel futures jumped Tuesday as energy analysts questioned whether President Donald Trump’s plan to bring Russian fuel to market would lower prices for truckers, farmers and other consumers. The futures rose 5% by midday to their highest level in weeks, while European diesel futures climbed about 3.8%, NBC News reported.

The increases came after Trump said Russia would supply more diesel for the United States and the world. He has predicted prices will fall quickly. A White House official told CBS News that adding hundreds of thousands of tons to global markets would lower costs for American workers.

Prices have already climbed sharply. The U.S. average for diesel was $6.27 a gallon Monday, up from $3.73 in late February, just before the U.S. and Israel attacked Iran, according to AAA figures cited by CBS News. Diesel reached a record $6.53 a gallon on Sept. 22; California’s average was $8.38 as of Monday. NBC News reported that the national diesel average has risen 70% since the Feb. 28 attacks, while unleaded gasoline has risen more than 45%.

“Absolutely stunning price spikes in wholesale diesel today,” Gulf Oil adviser Tom Kloza wrote Tuesday on X, according to NBC News. He said wholesale prices rose 18 cents a gallon on the Gulf and East coasts, 28 cents in Southern California and 25 to 30 cents in the Great Plains and Great Lakes. GasBuddy analyst Patrick de Haan said “$6/gal diesel may be here to stay for now.”

Trump said in an Oct. 9 post that Russia would “immediately supply” more than 300,000 metric tons of diesel, followed by 500,000 tons in November and 1 million tons “immediately thereafter,” CBS News reported. The administration issued a license allowing Russian diesel sales despite restrictions imposed after Russia invaded Ukraine in 2022.

Whether those sales would add much fuel to the market remains in dispute. Michael Lynch of the Energy Policy Research Foundation told The Associated Press that Russian diesel sent to new buyers could simply force existing customers to seek supplies elsewhere, leaving prices largely unchanged. S&P Global Energy analyst Debnil Chowdhury told CBS News that Russia’s promised volumes for this month and November fall within its current export range and might not increase overall supply.

Kloza also questioned Russia’s ability to deliver after Ukrainian strikes on its refining infrastructure. “One wonders whether Russia could export any diesel in October, November or December,” he told CBS News. Daniel Sternoff of Columbia University’s Center on Global Energy Policy said extra Russian fuel “might take the edge off of prices, but it will not substantially lower them,” given disruptions linked to the war with Iran.

Six senators from both parties urged the administration Sunday to “immediately reverse course” on the Russian supply plan, CBS News reported. Separately, Trump has pressed European allies to release diesel reserves, but the International Energy Agency said Europe was continuing an existing March pledge rather than offering new reserves, according to NBC News. Trump has also ordered wider access to tax-free red-dyed diesel. NBC News reported that its effect on domestic prices or supply remained unclear Tuesday.