US ultra-low-sulfur diesel futures fell more than 6% on Wednesday after Politico reported the administration of US President Donald Trump is preparing a plan to ban diesel exports for 90 days.
The October futures contract was last trading at $4.7512 a gallon, down 3.9%.
Diesel prices have shot to record highs in the US and Europe as wars in Iran and Ukraine have sharply cut exports from some of the biggest producers such as Russia, Saudi Arabia and the United Arab Emirates.
Trump said on Tuesday he backed a ban on diesel exports, as Republican candidates in some of the tightest election races in November called for the measure as a way to curb record fuel prices.
However, US Energy Secretary Chris Wright said on Wednesday that a US ban on diesel exports would not work and could push up gasoline and jet fuel prices.
(Reporting by Liz Hampton in Denver, Arathy Somasekhar in Houston; Editing by Aurora Ellis)