Diesel prices across Australia could surge beyond $3 a litre as Trump eyes cut to US fuel exports
Summary
Diesel prices in Australia are rising and could go over $3 a litre if President Donald Trump stops US diesel exports amid struggles in talks with Iran. Australia depends on diesel imports, so any cut in supply would increase fuel costs, which could also lead to higher prices for goods and more interest rate hikes.Key Facts
- Diesel prices in Australia have risen nearly 40 cents per litre since early April, with prices approaching $3 per litre in some cities.
- Australian diesel relies heavily on imports, with over 18.4 billion litres imported in the first seven months of 2026.
- The US is a significant exporter of diesel, shipping over 1.5 million barrels a day globally since the war in the Middle East began.
- President Trump is considering banning US diesel exports to lower prices at home before the November midterm elections.
- An export ban could cause diesel prices in Australia to rise above $4 per litre within weeks, according to one analyst.
- Australia’s diesel stockpiles have decreased from 39 days’ supply in July to 31 days in recent months.
- Conflicts in the Middle East and attacks on Russian supplies have reduced global diesel availability, pushing prices higher.
- The Australian government temporarily reduced fuel taxes in March but has not made further excise cuts despite rising prices.
- High fuel costs threaten industries like farming and mining and could lead to higher prices across food, manufacturing, and transport sectors.
- The Reserve Bank of Australia is expected to raise interest rates to 4.6%, partly due to rising fuel costs.
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