Landry's Diesel Export Ban Runs Into His Own Industry

Diesel hit $6.03 a gallon in Louisiana this month, a record, and Gov. Jeff Landry responded the way you'd expect from a governor watching farmers and truckers get squeezed. On Sept. 22 he declared a statewide emergency over diesel supplies, signed an executive order letting farmers and timber harvesters run dyed, off-road diesel in highway vehicles through Oct. 22, and threw his support behind a 90-day pause on U.S. diesel exports that Sen. Chuck Grassley and other Republicans have been pushing in Washington. The instinct is right. The mechanism, according to the people who actually run Louisiana's refineries, is not.

The Louisiana Mid-Continent Oil and Gas Association came out against the export ban this week, and its president, Tommy Faucheux, did not mince words. "Pipelines for domestic diesel transportation are already at max capacity. Without available capacity to redirect supply, halting the export of American diesel would force refineries to reduce production which would also decrease the production of gasoline," he said. "This is a misguided proposal that would cause more harm and increase, not decrease, costs for American families and businesses."

That is not a small warning coming out of this state. Louisiana runs 15 operating refineries with roughly 3 million barrels a day of crude processing capacity as of Jan. 1, 2026, according to the U.S. Energy Information Administration, anchored by Marathon Petroleum's Garyville plant, the nation's third-largest refinery at 617,000 barrels a day. The Gulf Coast refining complex produces more fuel than the region consumes, and it has built its storage and logistics around moving the surplus overseas. Cut off the exports and you don't free up diesel for American truckers. You fill the tanks, and then you shut units down.

The numbers back that up. U.S. refiners are turning out about 5.3 million barrels a day of distillate fuel against domestic demand of roughly 3.6 million barrels a day, according to the American Fuel & Petrochemical Manufacturers. Diesel and gasoline come off the same units in the same runs, so a ban that stops the surplus from leaving the country doesn't just sit there. It forces refiners to throttle back, squeezing gasoline and jet fuel supplies along with diesel. Three dozen industry groups, including the American Petroleum Institute, AFPM, the National Association of Manufacturers and the U.S. Chamber of Commerce, wrote the White House to say exactly that: "Export bans would lead to less fuel production, tighter supplies, and rising costs for American families, farmers, and truckers."

The White House has denied that a 90-day ban is actually in the works, despite President Trump and Treasury Secretary Scott Bessent both entertaining the idea publicly. Energy Secretary Chris Wright has been the clearest voice against it. "The blunt tool of banning diesel exports definitely doesn't work," Wright said. "If you can't export the diesel that comes out of our refineries, you run out of places to store it, and you have to reduce US refining, which would put upward pressure on gasoline prices and jet fuel prices," Wright said Wednesday. Wright says the administration is instead talking to oil companies about voluntary ways to keep more diesel at home. National diesel prices hit $6.529 a gallon for the week of Sept. 21, 2026, according to Energy Department data, with WTI crude at $96.41 a barrel and Brent at $114.89 a barrel on Sept. 22, 2026, so nobody is pretending this is a manufactured crisis. It's real, and it's driven in large part by refinery outages in Russia and the Middle East that have pulled 7 to 8 million barrels a day of product off the global market.

I understand the politics of Landry's position. Diesel at $6.03 a gallon is 112% above what LSU AgCenter used in its 2026 crop budgets, and that's a farmer's margin gone before harvest. But America First energy policy should mean building refining capacity and keeping the United States as the supplier the world depends on, not hoarding product behind a wall that Capital Economics has already labeled a way to "add fuel to the diesel crisis." Louisiana's refiners didn't build 3 million barrels a day of capacity to serve Louisiana. They built it to serve the world, and that's exactly why Baton Rouge and Garyville and Lake Charles matter to Washington in the first place.

This fight moves to New Orleans next week. Tulane's Future of Energy Forum runs Sept. 28-30, with Faucheux on a Sept. 28 panel about Louisiana's LNG industry, Public Service Commissioner Jean-Paul Coussan and Entergy Louisiana's Larry Hand discussing power affordability, and keynotes from FERC's David LaCerte, CenterPoint Energy CEO Jason Wells and Department of Energy General Counsel Jonathan Brightbill. Expect the export ban to come up in every hallway conversation before anyone reaches the ballroom.