Did Trump threats force the G7 to release 100 million barrels of diesel?

The Andrew Neil Report

Andrew Neil examines the looming threat of a US diesel export ban driven by Donald Trump's midterm election strategy and soaring domestic fuel prices, highlighting how such a move could

Key takeaways

• The US exports 1.5 million barrels of diesel daily, and a potential Trump ban would severely impact the UK, which currently imports 55% of its diesel supply.
• UK refining capacity has collapsed from 14 to just four refineries over the past two decades due to net zero mandates enforced by both Labour and Conservative governments.

Main topics

• US diesel export ban threat
• UK refining capacity & storage shortages

Notable quotes

"Trump always chickens out."

Conclusion

The episode underscores the severe economic vulnerability of the UK to U

Transcript preview

Speaker 3 (0:00) Hi, friends and fellow students. Americans living abroad can legally vote in the U.S. election. Register or get tailored support at VoteFromAbroad.org. Look, state deadlines are super close, so don't waste another second. Go to VoteFromAbroad.org now and click Request My Ballot and ask to receive it by email. All you got to do is fill it out and send it back in. Don't miss this chance to shape the future. Don't delay. VoteFromAbroad.org. Speaker 5 (0:28) As Donald Trump holds Britain and Europe to ransom over diesel, who'll blink first? This Speaker 4 (0:35) is Speaker 5 (0:35) the Speaker 4 (0:35) Andrew Speaker 5 (0:36) Newell Report. Speaker 4 (0:37) On the Trump issue, I wrote a column recently in the Telegraph saying this would be another case of taco. Trump always chickens out. You've been in this business even longer than me, Andrew, and you may be right. It may be that I overestimated Trump's rationality. Always a Speaker 5 (0:55) mistake, Speaker 4 (0:55) Liam. And it comes with a diesel ban. So, yeah, it may be that it happens. The polls before those crucial midterms that you referred to, he's very likely going to lose at least one House of Congress of the Democrats. He may even lose two. It will make the rest of his presidency a complete lame duck. Speaker 5 (1:19) Welcome to the show. Anyone in Britain will know how vulnerable the country is to a fuel crisis. There was chaos after Russia's invasion of Ukraine in 2022, and Trump's war in Iran has seen prices slowly tick up even this week. But the price of diesel in the UK is over two pounds a liter, and it could get much worse. The U.S. president has been threatening an export ban on diesel from America to lower his country's own price at the pump. Now, Britain sources over half its diesel from abroad and around 30 percent from America. And that potential ban, though it's not in place, could be catastrophic. Trump is now giving European countries, including Britain, an ultimatum. Release your own stockpiles of diesel so that America doesn't have to export so much and therefore American prices can be lowered. That at least is the theory anyway. Later in the show, I'll speak once again to economist Liam Halligan. But first, let me try to make sense of what's happening and what's at stake here. There is no question a looming diesel crisis. with the prospect of spiking prices, even though they're already at elevated levels, the potential for actual shortages, perhaps. And it threatens Europe in general, well, Latin America and Asia, but Europe in general and the United Kingdom in particular. And in a way, it has its origins in the faraway cornfields of Kansas. Yep. that prairie state in the Midwest. Population only about 3 million, hasn't elected a Republican senator since FDR's great New Deal landslide in 1932. Now, Kansas voted overwhelmingly for Donald Trump in 2016, 2020, and 2024. The last senatorial election in Kansas was in 2022, and the Republican candidate won there by... A 23-point margin. I think that's what you call a landslide. But this year, in the Senate election, in the Senate seat in Kansas, it's up for grabs. The latest poll average, as of the Republican, only 1.5 % ahead. 1.5. Remember the previous guy won by 23 points. Now, the chances are Republicans will still win Kansas. I don't think it's really on the Democratic realistic wish list. But if it's this close, only a margin of 1.5 percent or thereabouts, you can be sure Republicans are in real trouble in more marginal toss-up states. So what's this going to do with the price of diesel in Lille or Baden-Baden or Chipping Sodbury? I can hear you ask. Well, quite a lot, actually. The Kansas economy, farming, construction, road haulage, trucking as the Americans call it, they are all wholly dependent on diesel. And the price of diesel has soared in America this year, all down to Mr. Trump's war on Iran. It's now over $6.50 a gallon. That's 70 % more than the price of diesel before the Iran war started at the end of February of this year. And it's hurting, hurting individuals, hurting business, hitting costs, making it more difficult either to farm or to do road haulage or to keep your business going. And if it's hurting in Kansas, what's true in Kansas is just as true in other Midwest states, states where farming, trucking, construction are also very important, but also where the Democrats have better hopes of winning than Canvas. States like Iowa, Michigan, Ohio, and further south, even that Republican bastion of Texas, which hasn't had a Democratic senator since 1993. So the upshot of all this, not just diesel, but it's an important fact, is that Mr. Trump and his party risk losing not just the House, that's been on the cards for quite some time, but also the Senate. Certainly the House, in my view, and at least 50-50, if not more, that they lose the Senate too. Now this would leave Mr. Trump a lame duck president for the remaining two years of his presidency. And the soaring... Price of diesel, the fuel that powers the American economy. It's one of the main reasons if he does go down to defeat, why he went down to defeat. So there's something of a panic gathering in Republicans' circles as they watch this unfold. And there are very few options about what to do about it. Mr. Trump's approval ratings are very poor. The economy is not in great shape. At least that's what the voters think. Speaker 5 (6:50) and other things, the tariffs and so on, have not been going to the administration's advantage. But there is one thing that they could do, at least the Republicans think they could, and they've been talking about it more and more in the past few weeks, and that's to do with diesel. The United States is the biggest exporter of diesel in the world. 1.5 million barrels a day of the stuff. It exports. And the Republicans are clamoring to ban, or at the very least curb, this U.S. diesel export business. Why? Because they think if there were fewer exports, you could then flood the domestic market with more diesel. And if you flood the domestic market, they think that will bring diesel prices down and give them a better fighting chance. these crucial states I've been mentioning and Mr. Trump seems minded to go along with this now. Let's put aside the Unlikely fact of the fact that this is unlikely to work That it wouldn't really bear down on diesel prices. I don't think that need to detain us for today What matters is is he thinking of doing it or a version thereof and what would happen? And I have to tell you that if he does the consequences for Europe and the United Kingdom would be disastrous indeed potentially catastrophic for the United Kingdom Because here in Britain We've closed refinery after refinery. It's all been part of net zero, all been part of our green agenda. It's happened under Labour, Mr. Miliband, when he was Energy Secretary, before the Tories and after. But it happened under the Tories, too. They were part of that agenda. And we've gone in the last 20-odd years from 14 refineries to four refineries. So much for re-industrialization. The more politicians talk about that, the more we seem to close the very infrastructure which would make industrialization possible. And so we're down to only four refineries. And indeed, out of the four, the biggest one is now closed for 10 weeks for maintenance. Just brilliant. So as a result of closing these refineries over the years, we now import. 55 % of our diesel supplies. You see, we used to either surprise these refineries with crude oil from the North Sea, or we'd import the crude oil, they would refine it, some into petrol, some into jet fuel, a lot into diesel. Because we've only got four left, we now have to import 55 % of our diesel requirements. And a third of that import comes, you guessed it, from the united states and if that source of imports american exports was to dry up then prices which as i've said have already in the past twenty-four hours just tipped over two pounds a liter Well, they'll soar further. And in some places, there could even be genuine shortages. In other words, you couldn't get diesel at any price. Now, diesel, as in America, is also the lifeblood of the UK economy. Four in 10 British engines operating domestically are powered by diesel. Diesel is the fuel that dominates farming equipment. road haulage, construction machinery, not