---
title: U.S. SPR Drawdown Nears Threshold; U.S. Weighs Diesel Export Ban; Gulf Crude Oil Exports Approach Prewar Levels; U.S.-China Consider Tariff Cuts; Panama Canal Transit Costs Surge
description: A final U.S. SPR release, a possible diesel export ban, U.S.-China tariff talks and soaring Panama Canal and freight costs are reshaping supply risk.
image: https://media.supplyrisk.com/hubfs/AI-Generated%20Media/Images/Smooth%20Minimalist%20Deep%20Navy%20Gradient%20Background.png
---

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# U.S. SPR Drawdown Nears Threshold; U.S. Weighs Diesel Export Ban; Gulf Crude Oil Exports Approach Prewar Levels; U.S.-China Consider Tariff Cuts; Panama Canal Transit Costs Surge

by Lauren Palmer

 September 30, 2026

The U.S. advances a final 40 million barrel Strategic Petroleum Reserve release while weighing diesel export limits, the U.S. and China consider targeted tariff cuts, Gulf crude oil exports are recovering as refined-product exports remain severely constrained, and U.S. transport and Panama Canal transit costs surge.

**The U.S. is in the process of releasing the final 40 million barrels of the 172 million barrels** originally authorized as part of the IEA-coordinated response to the Iran war. This would bring the U.S. Strategic Petroleum Reserve to approximately 241 million barrels—below the 252.4 million-barrel level at which oversight from congress and the Defense Department takes effect. The Department of Energy offers oil releases from the SPR through exchanges, with participating companies required to return the borrowed crude to the SPR plus interest also paid in oil to the SPR. The repayments of the 172 million barrel released from the SPR in 2026 can begin in late 2026 and most repayments must be completed in 2028. The repayments will have the effect of reducing oil supply from the market. [The United States Energy Department Continues Execution of Strategic Reserve Release Commitments](https://www.energy.gov/articles/united-states-energy-department-continues-execution-strategic-reserve-release-commitments), [United States to Release 172 Million Barrels of Oil From the Strategic Petroleum Reserve](https://www.energy.gov/articles/united-states-release-172-million-barrels-oil-strategic-petroleum-reserve) (see external links)

**The White House is considering restrictions or a temporary ban on U.S. diesel exports, raising risks to European energy supplies.** The United States supplied about half of Europe’s diesel imports as of last month, while Middle East disruptions and attacks on Russian refineries have already tightened global fuel supplies and pushed energy prices higher. The EU’s energy commissioner, Dan Jorgensen, has urged member states to reduce gas and electricity consumption “for as long as necessary”, citing exceptionally low gas storage levels and the risk that a diesel export restriction could worsen an existing energy “price crisis”. European officials said there is no immediate supply crisis, but they are assessing the potential impact and lobbying the U.S. against a ban, while the White House is also considering limits rather than a full prohibition. [Trump’s proposed diesel export ban spurs fear of energy crunch in Europe](https://www.washingtonpost.com/world/2026/09/29/european-fears-energy-crunch-over-trumps-proposed-ban-diesel-exports/) (see external link)

**September crude oil exports from the Gulf (Hormuz, pipelines, Red Sea) were 90-98% of prewar normal** due to U.S. Navy escorts and pipeline shipments. **However, prices are elevated and exports of refined products (e.g. jet fuel, diesel, naphtha) are 50-58% of prewar normal**. Gulf refineries accounted for 10-11% of global refined product capacity in 2025. Russian refinery exports are severely restricted, taking additional refined products offline. Russia accounts for 6% of global refinery capacity, per IEA. [Middle East Crude Oil Exports Back at Prewar Levels, Analysts Say](https://www.wsj.com/business/energy-oil/middle-east-crude-oil-exports-back-at-prewar-levels-analysts-say-b5582027), [Russian refining sector struggles amid intensifying Ukrainian attacks](https://www.iea.org/commentaries/russian-refining-sector-struggles-amid-intensifying-ukrainian-attacks?) (see external links)

**The U.S. and China announced a “30-for-30” initiative identifying approximately $30 billion of exports from each country for potential tariff reductions.** U.S. goods exported to China under consideration include medical devices and cosmetics. Chinese goods exported to the U.S. are concentrated in consumer products and do not include medical devices. Any tariff reductions will be implemented through each country’s domestic legal process, and the White House has not yet announced an effective date. [Fact Sheet: President Donald J. Trump Advances a Fair and Reciprocal Relationship with China While Hosting Historic State Visit](https://www.whitehouse.gov/fact-sheets/2026/09/fact-sheet-president-donald-j-trump-advances-a-fair-and-reciprocal-relationship-with-china-while-hosting-historic-state-visit/), [U.S. and China to Cut Tariffs on $60 Billion of Goods](https://time.com/article/2026/09/29/us-china-reciprocal-tariffs-cut-trade-goods-60-billion/) (see external links)

**Panama Canal transit costs have surged,** driven by rerouted vessels amid conflict in the Middle East, increased demand for canal capacity and transit restrictions caused by water shortages. Auction premiums have risen sharply, with a South Korean LPG carrier recently paying more than $5 million to secure a transit slot. Average premiums had already climbed to roughly $385,000–$425,000 in April and May, compared with typical bids of about $135,000–$140,000 before Middle East disruptions intensified. Recent rainfall is easing Panama Canal water constraints, prompting the Panama Canal Authority to increase neopanamax transits to 10 per day beginning October 15, lifting combined neopanamax and panamax capacity to 33 daily slots, while also raising the maximum neopanamax draft to 49 feet. [Panama Canal Transit Costs Hit $5 Million Amid Shipping Squeeze](https://www.businesstimes-bd.com/international/11445), [Rains ease water pressure at the Panama Canal](https://splash247.com/rains-ease-water-pressure-at-the-panama-canal/) (see external links)

**Transportation costs are rising sharply across the U.S. economy,** with trucking expenses at their highest level since the Covid pandemic and diesel prices up 77% over the past year. Container-shipping rates are also up, while railroads, parcel-delivery companies such as FedEx, and the U.S. Postal Service are raising prices, with a shortage of truck drivers adding further pressure to freight costs. [Soaring Transport Costs Spread Through U.S. Economy](https://www.wsj.com/logistics-report/soaring-transport-costs-spread-through-u-s-economy-fb7cd42f?mod=djemlogistics_h) (see external link)

---

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