The Trump tax-free diesel order signed on Monday, 5 October 2026, allows anyone to buy red-dyed diesel for any reason and defers the federal tax on on-road use until the end of the year.
According to CNN, President Donald Trump signed the order late on Monday US time at a campaign rally in Grand Island, Nebraska, four weeks before the midterm elections on Tuesday, 3 November 2026.
In a White House statement, Trump said:
“Tonight, I am going to sign a historic Executive Order to officially waive the off-road requirement and allow anyone to purchase tax-free red dye diesel for any reason.”
What does the Trump tax-free diesel order do?
The order temporarily allows red-dyed diesel to be used on public roads and defers the federal diesel excise tax of 24.4 cents a gallon through the end of 2026, with “no interest, no penalties”. It directs the Treasury Secretary to explore eliminating the deferred tax and asks the Transportation Department to coordinate with states, industry and labour groups.
The Agriculture Department is tasked with protecting farmers’ access to fuel supplies in high-demand areas, and White House officials will encourage states to adopt similar relief measures.
Users must still comply with applicable state rules and requirements.
How much will the Trump tax-free diesel order save?
The White House put the federal saving at about $60 on a 250-gallon fill-up and CNN‘s reporting put it at about $150, so the figures conflict and require further confirmation. Trump claimed a larger saving, saying:
“The typical trucker will save more than $100 every time they fill up.”
What is red-dyed diesel and why is it cheaper?
Red-dyed diesel is chemically almost identical to ordinary diesel, but the dye marks it as exempt from highway fuel taxes. It is meant for off-road equipment such as farm and construction machinery, and using it on public roads has been illegal.
Tom Kloza, chief energy adviser at Gulf Oil, said:
“One doesn’t have to pay federal and state excise taxes on dyed diesel, but it really doesn’t shift the amount of overall diesel manufactured for domestic purposes.”
Why diesel prices are high and what experts say
The national average stood at $6.32 a gallon on Monday, 5 October 2026, down from a peak of $6.53 on Tuesday, 22 September 2026, and up from $3.76 before the Iran war, after diesel set a record high earlier in September.
Patrick De Haan of GasBuddy, a fuel price tracking service, said farmers already use red-dyed diesel, so the order mainly helps on-road users such as truckers who paid the full federal tax. He called its effect on prices:
“It’s not really a needle-mover.”
Andy Lipow of Lipow Oil Associates, an energy consultancy, said the order helps buyers in the short term but leaves the supply problem behind the price spike, which began with the Iran war, untouched. He added:
“This does save the consumer money in the short term, but it doesn’t solve the underlying issue.”
Washington has used other measures, including a summer blend gasoline waiver.
In South Africa, the October 2026 fuel price increase lifts diesel 0.05% by R2.84 a litre from Wednesday, 7 October 2026, after a September adjustment that hit diesel hardest.
Sources
- The White House, President Trump takes decisive action to lower diesel costs for American truckers, farmers
- CNN via ABC17, Trump signs executive order aimed at lowering diesel prices
- Fox Business, Trump lets truckers use red diesel on highways and defers fuel tax
- Fox 13 Seattle, Trump signs executive order easing red-dyed diesel limits
- Fox 13 Seattle, Trump eyes red-dyed diesel as fuel prices soar: What is it?
- Gulf News, Trump signs order for cheaper red-dyed diesel
- NBC Right Now, Trump signs order extending tax-free use of red-dyed diesel during midterm stop in Nebraska
- Swisher Post, US diesel price record high as Iran war hits supply
- Swisher Post, Summer blend gasoline rule ends early to cut fuel prices
- Swisher Post, October 2026 fuel price increase: How much a litre costs
- Swisher Post, September 2026 fuel price increase hits diesel hardest
