North Dakota Declares Diesel Emergency, Allows Dyed Fuel for Farmers

Emergency Diesel Relief for North Dakota Harvest Operations

Under standard North Dakota law, the state levies a 23-cent-per-gallon excise tax on regular diesel fuel. Red-dyed diesel carries an excise tax of only 4 cents per gallon, but its use is strictly restricted under normal conditions to certain off-highway agricultural, industrial, and railroad purposes. Armstrong’s emergency order temporarily lifts those on-highway restrictions for licensed motor vehicles used in connection with ag operations through Nov. 30.

The temporary adjustment allows agricultural producers to utilize the lower-taxed fuel not just for field work in tractors and harvesting equipment, but also for on-highway uses. Farmers are now permitted to fuel transportation for grain, livestock, feed, seed, fertilizer, equipment, and other agricultural products and inputs, as well as operations involving the storage and processing of those goods. Armstrong formulated the action in close coordination with state Agriculture Commissioner Doug Goehring.

“Record high diesel prices are squeezing our ag producers, and this is a meaningful and timely step we can take to provide temporary relief and help our farmers and ranchers through the harvest season,” Armstrong said in the official announcement.

Commissioner Goehring emphasized the timing of the measure, noting that farmers burn more diesel during harvest than at any other time of year. Saving 19 cents per gallon can make a meaningful difference when margins are razor thin. State officials anticipate that lower transportation costs to suppliers and processors will hopefully be passed on to the consumer.

Tax Differentials and Federal Rules

Dyed diesel and regular diesel are chemically identical, but the way they are taxed is fundamentally different. Red dyed diesel is the most common, used for off-road vehicles, machinery, and equipment, as well as home heating.

The North Dakota executive order applies strictly to the state’s excise tax. The federal government’s 24.4-cent-per-gallon excise tax on diesel fuel remains completely unaltered by this measure.

The state-level intervention mirrors emergency measures enacted elsewhere in the country as agricultural and freight sectors absorb financial pressure. In Texas, Governor Greg Abbott declared a 30-day statewide disaster on Sept. 28, 2026, suspending state dyed-diesel road penalties, raising allowable weight for fuel, agricultural, and timber loads to 95,000 pounds, and citing a statewide average diesel price of $5.86 per gallon. Industry analysts attribute soaring pump prices to refining capacity constraints and geopolitical disruptions affecting international crude transit.

Timeline of the North Dakota Emergency Order

• Sept. 29, 2026: Governor Kelly Armstrong signs the executive order declaring a state of emergency for diesel fuel supplies and authorizing on-highway use of red-dyed diesel for agricultural transport.
• Immediate Effect: The order takes effect upon signing, granting immediate excise tax relief of 19 cents per gallon for eligible farm and ranch operations.
• Nov. 30, 2026: The temporary emergency authorization is scheduled to expire, returning diesel usage regulations to standard statutory enforcement.

Federal diesel taxes and agricultural vehicle exemptions

Does the emergency order eliminate federal diesel taxes?

No. The executive order only affects state-level excise taxes and enforcement. The federal government’s 24.4-cent-per-gallon excise tax on diesel fuel remains fully in effect.

Which vehicles qualify for the dyed diesel exemption under the order?

The order applies to licensed motor vehicles used in connection with ag operations, including trucks used to haul grain, livestock, feed, seed, fertilizer, and equipment.

Does the order apply to non-agricultural commercial trucking?

No. North Dakota’s emergency relief is specifically targeted at agricultural producers and harvest operations through Nov. 30, 2026.