Politics / Energy — An executive order letting farmers burn tax-exempt red-dyed diesel on public roads was meant to cut harvest fuel costs. Farmers told Reuters the saving is small, the residue lasts for years, and state fines can reach $10,000.
President Donald Trump signed an executive order this month expanding access to tax-exempt diesel as soaring fuel prices frustrate voters ahead of the midterm elections. Farmers, the intended beneficiaries, are largely declining it. Reuters reported on Thursday, October 22, that growers say using red-dyed diesel in trucks on public highways is too risky to justify the saving — red residue can linger in a fuel tank for years, long after the order expires on December 31, and states can fine drivers thousands of dollars if an inspection finds traces of improper use.
Track it live: Live oil price tracker — diesel, Brent and WTI
How the order works — and where it stops
Red diesel is chemically the same fuel as regular road diesel, but it is sold exempt from highway fuel taxes for off-road use in farm equipment, and dyed red so inspectors can tell the difference. Trump's order temporarily waives the off-road requirement, and the Internal Revenue Service said it will not impose a federal penalty when dyed diesel is used on highways from October 1 to December 31. The catch is in the fine print: the order has no effect on state taxes and state penalties. States have their own rules for red diesel, and in Kansas fines can reach $10,000. A federal waiver that leaves fifty state regimes untouched is, for a farmer whose truck crosses county and state lines, a partial permission slip.
"In my mind, it's not anywhere near worth the risk," Glenn Brunkow, president of the Kansas Farm Bureau, who raises crops and cattle near Wamego, Kansas, told Reuters. "That residue might be in there for years." The administration has paired the order with an $8 billion financial support programme announced Monday to offset diesel costs for farmers during the autumn harvest, a relaxation of sanctions on Russian fuel shipments, pressure on allies to release emergency oil stocks, and a temporary lifting of restrictions on foreign-flagged vessels moving between U.S. ports. Prices remain elevated because of the U.S.-led war with Iran — Brent crude traded above $111 a barrel on Thursday.
Why this matters
The episode is a small, precise illustration of the limits of executive action against a commodity price. A president can waive a federal tax rule with a signature; he cannot waive physics (dye persists), federalism (states tax and fine separately) or a war-driven crude market (Brent at $111 sets the floor under every gallon). It also shows where the political pressure actually sits: the order, the $8 billion programme and the stock releases are all aimed at the same constituency — rural voters whose fuel and grocery costs are now the central midterm issue, including in states like Iowa where the president is rallying this week. When the intended beneficiaries publicly refuse the help because the design does not survive contact with their real legal exposure, the policy problem is no longer the price of diesel. It is credibility.
Both sides, stated fairly
The administration's case is that every cent per gallon counts at harvest, that the IRS waiver removes the federal risk entirely for the October–December window, and that farmers who keep dyed diesel in clearly separated tanks and vehicles can use it lawfully. Farm groups' case is practical rather than political: tanks are shared, trucks are old, residue tests do not care about intentions, and a single state fine erases years of per-gallon savings. Both can be true — the order helps a narrow set of operations with dedicated equipment, and is unusable for the typical mixed fleet it was announced to help.
What happens next
The waiver expires December 31, in the middle of winter fuel season. Watch whether any state aligns its penalties with the federal waiver — none had at publication — and whether diesel prices, not paperwork, decide farm-state races on November 3. If Brent stays above $110, expect the pressure that produced this order to produce larger ones.
Sources
Reuters, "Trump's tax-exempt diesel draws skepticism from farmers, eludes others," October 22, 2026, including Kansas Farm Bureau comment and IRS guidance on the October 1–December 31 waiver window.