Off-road diesel price: dyed (red) diesel today
Dyed (red) diesel for off-road and agricultural use sells for $0.55-0.95 per gallon less than on-highway ULSD - the federal 24.4 cent excise plus most state excise is stripped. Same fuel chemistry, identical engine performance. Use it on a public highway and the IRS penalty is $1,000 per occurrence or $10 per gallon, whichever is higher. [IRS · 13 Jul 2026]
What dyed diesel is
The red dye (Solvent Red 164) is added at the terminal to flag fuel as tax-exempt. The EPA-mandated ULSD specification (15 ppm sulfur) applies to dyed diesel just as it does to clear on-highway diesel. [EPA · 13 Jul 2026]
Who can legally buy and use it
- Farmers for agricultural equipment
- Construction operators for non-licensed off-road equipment
- Marine and stationary engines (subject to state rules)
- Heating-oil buyers in the Northeast where the dye marks tax-status
Penalty for misuse
Federal: $1,000 per occurrence or $10 per gallon, whichever is greater (IRC Sec 6715). States stack their own penalties: California $5,000, New York $1,000-2,500, Texas $200 per gallon. [IRS · 13 Jul 2026]
Pricing today
Bulk delivered red diesel is generally 55-95 cents under on-highway. Local fuel distributors price weekly. The OPIS retail-on-highway figure is the public benchmark; off-road quotes are private.