Trump's diesel export ban could cut diesel prices at first — then add 30 cents per gallon to gas, Goldman Sachs warns

President Donald Trump continues weighing a diesel export ban in a last-ditch effort to provide financial relief to voters getting squeezed by rising gas prices ahead of the November midterms.

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"We're thinking about it very seriously," Trump told Fox News on Sunday. "That can oftentimes lead to a little bit of an increase on gasoline for cars, so we're looking at it very seriously. We may do it."

A debate appears to be brewing in the Trump administration over the scope of a federal ban. Energy Secretary Chris Wright has said he supports a voluntary export ban instead of a mandatory one since across-the-board restrictions could trigger the higher prices the administration wants to avoid.

"We're trying to avoid a blunt hammer of a government policy, understanding the complexity of refining," Wright told the Wall Street Journal last week.

Republican lawmakers from predominantly farm states have repeatedly lobbied the Trump administration to implement an export ban on diesel. Many Republicans are anxious of receiving backlash from voters that could cost them control of the House, Senate or both in the midterms.

"American fuel should stay home with Americans," Sen. Dan Sullivan of Alaska said in a Sept. 22 press release. The cost of diesel is just too damn high."

Diesel is the typical fuel used by heavy freight vehicles and ships that transport food, furniture, and other commercial products to their destination. Farm and construction equipment rely on diesel as well. The US currently produces 5.3 million barrels of distillate fuel each day, which includes diesel, per the Energy Information Administration.

Diesel's national average is $6.45 per gallon as of Monday, according to AAA , just below the $6.52 all-time high that was recorded a week ago. Diesel prices have shot up over 70% since the start of the Iran War, the effect of a collapse in steady diesel supplies flowing from the Middle East and to a lesser extent, Russia.

Goldman Sachs analysts recently mapped out how a diesel export ban could filter through to gas prices. At first, diesel prices could fall by 25 cents per gallon each week while storage space is available. But that won't be the case for long.