Gulf Oil Chief Energy Adviser Tom Kloza says a U.S. ban on diesel exports would backfire

Oil Prices Easing, but Diesel Remains Extremely Expensive

• The video reports Brent crude slipping to around $97 a barrel (with WTI below $90) after news that Saudi Arabia restarted operations on its East–West pipeline following a drone attack.
• Despite the crude pullback, the emphasis is that refined products—especially diesel—remain costly.

U.S. Considers a Diesel Export Ban; Adviser Warns It Would Backfire

• President Trump is said to support exploring a temporary U.S. ban on diesel exports.
• Treasury Secretary Scott Bessent would be tasked with assessing whether such a measure would reduce fuel prices for Americans.
• Tom Kloza (Gulf Oil chief energy adviser) argues a ban would be harmful in the long run, disrupting global supply chains.

Why Kloza Says the Ban Won’t Lower Prices (and Could Raise Uncertainty)

• Short-term effects: If positioned as a threat, it could deter some speculative activity in diesel/heating oil futures.
• Long-term effects: A ban would affect Europe, Asia, Africa, and other regions because the U.S. supplies about 1.5–1.7 million barrels/day abroad and there is no easy worldwide alternative for that volume.

U.S. Supply Isn’t the Core Problem, Kloza Says

Kloza argues the issue is not primarily domestic U.S. availability:

• The U.S. consumes about 3.8 million barrels/day
• The U.S. exports about 1.7 million barrels/day
• Refineries can produce roughly 5.2–5.3 million barrels/day

He implies price pressure is driven more by broader disruptions and conflict-related supply constraints than a simple domestic shortage.

Geopolitical Disruptions Keeping Diesel Tight

• The Russia–Ukraine war is cited as the biggest diesel-supply issue, with about 3 million barrels/day reportedly taken offline from Russian refining.
• Even after a supposed truce announcement, Kloza notes continued refinery attacks.
• Other risks include possible impacts from the Red Sea conflict (Houthis) and attacks around Persian Gulf refining and shipping nodes.

Refining Margins Support Continued Maximum Diesel Production

• The video highlights a major imbalance:
  • Crude: roughly $90–$100
  • Diesel: roughly $200–$220 per barrel
• These very large refining margins encourage producers globally to maximize diesel output, including in the U.S. using renewable feedstocks such as soybean oil and used cooking oil.

Jet Fuel Is Less Constrained Than Diesel

Kloza contrasts diesel with jet fuel:

• Jet fuel is said to be easier to adjust at refineries.
• If a refinery processes 100 barrels of crude, it may be able to produce more jet fuel relatively easily—he notes output could rise from about 8 barrels to ~11–12%.
• Diesel, by contrast, is described as harder to increase, keeping it under tighter pressure.

Environmental “Silver Lining”

• Diesel is framed as less polluting than in the past (“not your father’s diesel”).
• Modern diesel has much lower sulfur and improved environmental performance compared with decades ago.

Presenters/Contributors

• Tom Kloza — Chief Energy Adviser, Gulf Oil
• Richard — host/interviewer (name given only as “Richard” in subtitles)
• Mohamed El-Erian — economist quoted/commented in the segment
• Donald Trump — mentioned as supporting the temporary diesel export ban
• Scott Bessent — Treasury Secretary; tasked with assessing feasibility