President Trump Signed Order For Red Dye Diesel
The order allows red dye diesel for highway use, providing a potential tax break for drivers on fuel costs.
Updated on Oct. 6, 2026 in Trucks
Live Poll
Do you believe federal fuel tax suspensions will result in lower prices at your local pump?
President Trump has signed an executive order permitting the use of red dye diesel for on-road trucking. This federal policy shift aims to provide relief to drivers facing near-record diesel prices across the country.
Why it matters
By deferring the 24.3-cent federal excise tax on diesel, the administration aims to lower fuel costs for the trucking industry. This move comes as the national average retail diesel price remains high at $6.199 per gallon, despite recent weekly declines.
The average retail diesel price recently fell 18.3 cents to $6.199 per gallon. This price remains 33 cents below the DOE/EIA series all-time high of $6.529 per gallon, with the federal excise tax now deferred.
The players
President of the United States
The current President of the United States who issued the executive order affecting national fuel taxation.
DOE/EIA
The Department of Energy and Energy Information Administration responsible for tracking national energy statistics.
The details
The executive order allows trucks to use red dye diesel, which is typically reserved for agricultural and off-road vehicles, on public highways without paying the standard 24.3-cent federal excise tax. While the administration intends to study ways to permanently eliminate this tax obligation, large trucking fleets may remain hesitant to switch fuels due to inconsistent regulations across states like Alabama, Louisiana, and Texas.
Timeline
September 23, 2026: The November ULSD contract settled at $4.6336 per gallon.
October 5, 2026: President Trump signed the executive order authorizing the fuel change.
October 6, 2026: The new national average retail diesel price took effect.
The Home Front
This policy marks a significant departure from the long-standing federal excise tax structure on diesel fuel. It shifts the regulatory landscape by creating a temporary exemption for the trucking industry that diverges from current standard highway-fuel taxation.
If you manage a business fleet, verify your current state-level regulations, as some regions still maintain conflicting rules for on-road red dye diesel usage. Consult a licensed tax professional to understand how the deferral of the 24.3-cent excise tax may affect your operational expenses.
The takeaway
While the executive order aims to lower fuel costs, fleets should remain cautious due to the lack of universal highway access for red dye diesel. Monitor the national retail diesel price trend, which currently sits at $6.199 per gallon, for any shifts resulting from this policy implementation.
Further reading
For more on the changing landscape of commercial vehicles, visit our Trucks section.
Source note: This article includes information reported by FreightWaves.
Live Poll
Do you believe federal fuel tax suspensions will result in lower prices at your local pump?
