Potential Diesel Export Curbs Manageable for Midstream

• U.S. diesel exports averaged 1.4 million barrels per day in 1H26, while imports mainly arrived on the East Coast.
• Disruptions to global diesel supplies and falling inventories have driven a spike in diesel prices, with prices in the U.S. recently at all-time highs.
• For midstream, exposure to diesel exports is limited and a ban would likely not have a significant impact.

The U.S. boasts a robust domestic refining industry and has long been a net exporter of refined products (gasoline, diesel, jet fuel, etc.). For 1H26, the U.S. averaged diesel exports of 1.4 million barrels per day (MMBpd). U.S. diesel largely goes to Central and South America (standouts by volume include Mexico, Brazil, Chile), as well as Europe, namely the U.K. and Netherlands.

While the U.S. is a net exporter of gasoline and diesel, it has typically been in short supply of products on the coasts with refinery closures over the last several years a contributing factor. Diesel imports predominantly arrived on the East Coast and averaged just under 0.2 MMBpd in 1H26 for the U.S. in total. To be fair, import volumes moderated after the start of the war with Iran and may have been helped by the Jones Act waiver (discussed more below).

The U.S. imported just over 0.5 MMBpd of gasoline in 1H26, again mostly into the East Coast but with noticeable volumes coming into the West Coast as well. Gasoline exports averaged over 0.9 MMBpd.

The effective closure of the Strait of Hormuz and damage to Russian refining capacity have put a dent in global diesel supplies. Russia has banned diesel exports. China banned gasoline, diesel, and jet fuel exports in March, but with easing restrictions, exports were above pre-war levels in August.

Diesel inventories have drawn down globally, including a drop of more than 13 million barrels in U.S. diesel stocks since the war began even with rising refining utilization. Per media reports, the U.S. has even asked Ukraine to stop hitting Russian refining capacity. Diesel prices in the U.S. reached an all-time high on September 15, but have since moderated with more discussion of a potential export ban.

Midstream companies often operate export terminals, generating fees for loading hydrocarbons onto ships. Midstream is typically more involved in the export of crude, natural gas liquids (NGLs), and liquified natural gas than gasoline or diesel. Complex refineries on the Gulf Coast are often exporting these products directly from their docks. Furthermore, MPLX (MPLX) is now the only public midstream name with a refiner parent in Marathon Petroleum (MPC).

MPLX owns 31 barge docks and owns docks at select MPC refineries, but their marine business handles crude, refined products, and blendstocks. Diesel export exposure is likely limited and manageable in the event of an export ban. MPC exported just under 0.2 MMBpd of distillate (includes jet fuel, diesel, kerosene, fuel oils) in 2025, albeit exports were at an undisclosed record in 2Q26.

MPLX owns one export terminal per its annual report, presumably Mount Airy on the Gulf Coast, which was acquired in 2018. The facility then had a capacity of 0.12 MMBpd across various refined products with capabilities to load ocean-going ships and barges for domestic use. Mount Airy likely has third-party volumes and its ability to handle a variety of products provides flexibility.

Beyond MPLX, Enterprise Products Partners (EPD) has marine terminals with refined product capabilities, albeit smaller than its crude and NGL volumes. For the trailing 12 months as of 2Q26, petrochemicals and refined products volumes totaled less than 0.4 MMBpd, compared to NGLs just over 1 MMBpd and crude at almost 0.9 MMBpd. Diesel volumes, if any, would presumably be relatively limited.

If a diesel export ban were implemented, docks that may have loaded ships for export could load ships for U.S. destinations on the East and West Coasts, albeit the demand is more limited. As a reminder, the Jones Act requires oil and fuel movements between domestic ports on U.S. flagged vessels built in the U.S. However, a Jones Act waiver was put in place in mid-March and currently extends beyond the election, through mid-November. This could provide some support for volumes across docks if restrictions are introduced.

Commentary around a potential diesel export ban has varied somewhat among the administration and politicians in Washington. High fuel prices are certainly a hot-button issue in an election year. Elevated diesel prices are particularly impactful for farmers, which tend to carry significant political clout. Republican Senator Chuck Grassley of Iowa has been supportive of a temporary diesel export ban.

Given election year politics, there could be a temporary diesel export ban or quota deployed. To some degree, rhetoric has already helped ease prices a little. A ban could lead to a surge in exports before an implementation date, boosting prices. If diesel export restrictions are put in place, they may be short term to bridge through the election. One risk of an export ban is diesel inventories filling and necessitating refining run cuts, which would then pressure U.S. gasoline prices. That would depend on the duration of any restriction.

A diesel export ban or quota would likely weigh more on U.S. refiners, which has been reflected in their trading lately. Midstream would be more insulated given its greater focus on crude, NGL, and LNG exports, with limited refined product export exposure.

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