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Trump escalates rhetoric against Iran... President Donald Trump called for Iran’s “unconditional surrender” in its war with Israel. “We know exactly where the so-called ‘Supreme Leader’ is hiding. He is an easy target, but is safe there - We are not going to take him out (kill!), at least not for now,” Trump posted on social media. Trump made the comments as the U.S. expanded its military footprint in the region.
The White House said the U.S. isn’t joining Israel’s attacks on Iran, amid speculation fueled by recent military buildup in the region. A third U.S. Navy destroyer entered the eastern Mediterranean Sea to help defend Israel and a second U.S. carrier strike group is heading toward the Arabian Sea.
While the Pentagon says the military buildup is purely defensive, it puts the U.S. on a firmer footing to join Israeli attacks on Iran should Trump decide to go that route. Trump met with his national security team in Washington Tuesday afternoon as he considered his response to tensions in the Middle East, including a potential U.S. strike against Iran, the Wall Street Journal reported. Administration officials said a strike was just one of the options Trump was considering and no decision has been made. Trump, who had been pressing for a diplomatic solution, wants to ensure that Iran isn’t able to develop its nuclear capabilities.
Diesel, fertilizer risks from Middle East tensions... The recent escalation of hostilities between Israel and Iran has sent shockwaves through global energy markets, with diesel futures in the U.S. experiencing some of the most dramatic price movements.
U.S. ultra-low sulfur diesel (ULSD) futures surged to $2.38 per gallon, marking their highest level since February and outpacing gains in both crude oil and gasoline. The ULSD crack — a measure of refining profitability for diesel — jumped to about $28 per barrel, reflecting intense market anxiety over potential supply disruptions from the Middle East.
Why diesel is most exposed
- Supply chain vulnerability: The Middle East is a critical hub for the export of distillate fuels, including diesel, gasoil, and jet fuel. Combined exports from the region averaged 1.76 million barrels per day in May, nearly 2% of global oil consumption.
- Heavy-S crude impact: The conflict’s primary market impact is expected to be on the supply of medium and heavy-sour crude grades, which are essential for producing diesel and other distillates. Disruptions here disproportionately affect diesel availability compared to gasoline.
- Low inventories: U.S. diesel and heating oil inventories stood at 108.9 million barrels as of early June — about 15% below the five-year average. This tightness amplifies the effect of any supply shock.
- Infrastructure and shipping risks: The Strait of Hormuz, a vital chokepoint for global oil flows, is at heightened risk of blockade or disruption, further threatening diesel supply chains and shipping rates.
Analysts predict that U.S. retail diesel prices could rise by 10 to 30 cents per gallon in the next two weeks due to the surge in crude and diesel futures, combined with already low inventories. The current conflict underscores the vulnerability of U.S. farmers to global energy shocks. While earlier forecasts suggested a possible summer break in diesel prices due to lower crude oil prices earlier in the year, the latest escalation has reversed this trend. Any prolonged disruption to Middle Eastern diesel exports could force farmers and other diesel users to pay higher prices for longer, with ripple effects across the U.S. agricultural supply chain.
About the only saving grace is that right now, diesel demand for many farming operations is not significant. The closer it gets to harvest, the more impact it will have. But this could also affect farmers’ ability to forward book fuel supplies.
Fertilizer prices and supply
- Fertilizer production (especially nitrogen-based, like urea and ammonia) depends heavily on natural gas. While European and U.S. natural gas prices haven’t spiked as sharply as in past Middle East crises, they have firmed up on risk premiums.
- Shipping Costs: Freight rates in the region (notably through the Persian Gulf and Red Sea) have increased due to heightened security risks and insurance costs. Some vessels are rerouting around conflict zones, causing longer shipping times and localized shortages, mainly in countries heavily dependent on Persian Gulf supplies (notably in Asia and Africa).
- No severe shortages — yet: Global fertilizer supply chains remain intact, but several key producers (like Saudi Arabia and Qatar) are on alert for possible disruptions. Iran itself is a major urea exporter, but its exports have been affected by sanctions and, more recently, by concerns over maritime safety.
As of now, the Iran/Israel conflict has pushed fertilizer shipping costs and some prices modestly higher, with delays mainly for Asia/Africa. The U.S. farmer faces higher price risk but not severe supply problems — unless the conflict expands and hits natural gas or global shipping much harder.
EPA’s RFS proposals for 2026, 2027 published... EPA has published its proposed rule for 2026 and 2027 standards under the Renewable Fuel Standard (RFS) with public comments on the package due by Aug. 8. EPA also detailed its plan to hold a virtual public hearing on the plan July 8 and July 9 if needed via a separate notice.
H-2A visa reform: The Farm Workforce Modernization Act... Rep. Dan Newhouse (R-Wash.) is at the forefront of efforts to reform the H-2A agricultural worker visa program, championing the Farm Workforce Modernization Act — a bipartisan bill designed to address long-standing challenges in America’s farm labor system. With the president’s recent endorsement of farm labor reform, Newhouse sees renewed hope for passing long-awaited legislation.
Key Features of the Farm Workforce Modernization Act
- Certified Agricultural Worker (CAW) Status: Provides a pathway for undocumented farmworkers to obtain legal status if they meet employment and background check requirements. CAW status lasts 5.5 years, is renewable, and offers a route to permanent residency after further agricultural work.
- H-2A program updates:
o Adjusts wage calculations to reduce volatility and sets recruitment standards for U.S. workers before foreign hires.
o Guarantees a minimum number of work hours for H-2A employees.
o Expands eligibility to year-round industries like dairy, not just seasonal jobs. - Portable H-2A Visa Pilot: Launches a pilot allowing 10,000 H-2A workers to move between registered agricultural employers, increasing flexibility for farms and workers.
- Mandatory E-Verify: Requires all agricultural employers to use electronic employment verification, aiming to reduce unauthorized hiring.
- Farmworker Housing Support: Permanently authorizes programs to finance and assist in rural and off-farm housing for agricultural workers.
The bill has passed the House in previous sessions with bipartisan support, reflecting months of negotiation with farmers, labor groups, and worker advocates. Proponents argue the reforms are essential for resolving critical labor shortages and ensuring a stable food supply. However, the measure still faces challenges in the Senate, and some industry groups seek further changes on wage and worker protection provisions. Newhouse and his allies remain determined to find common ground, emphasizing the urgent need for action as the agricultural workforce crisis grows.
Outlook: With White House backing, momentum behind the Farm Workforce Modernization Act is building. Rep. Newhouse and supporters are hopeful that 2025 could finally bring comprehensive H-2A visa reform, delivering lasting benefits for both farm employers and the workers who sustain America’s food system. Of note: The Trump administration is also reportedly reviewing some executive changes to the program.