US President Donald Trump has signed an executive order aimed at reducing soaring diesel prices by allowing wider purchases of tax-exempt red-dyed diesel fuel.

Trump announced the measure during a campaign rally in Grand Island, Nebraska, on Monday as his administration faces growing pressure over the rising cost of fuel and other basic goods ahead of the November 3 midterm elections.

The president said the order represented an “unprecedented step to bring down costs” as diesel prices continue to rise amid the war in Iran.

Dyed diesel fuel is normally sold at a lower price because it is exempt from federal and state excise taxes, but its use is restricted under existing regulations.

Trump said removing those restrictions would reduce costs for truckers and other businesses that rely heavily on diesel.

He claimed the measure could save a typical trucker more than $100 every time they fill their vehicle’s tank and would eventually help reduce the cost of other goods, including groceries.

The announcement came as Trump campaigned in Nebraska for Republican Senator Pete Ricketts ahead of the November midterm elections.

The president has been travelling across Republican-leaning states as part of what he described as a 32-day campaign blitz designed to boost Republican candidates and voter turnout.

However, rising living costs have emerged as a major concern for voters, including many rural Americans who have traditionally supported Trump and the Republican Party.

An AP-NORC poll cited by The Associated Press found that about half of US adults were “extremely” or “very” concerned about being able to afford fuel, up from 39 per cent in July. A similar proportion expressed high concern about being able to afford food.

Trump has repeatedly defended his administration’s handling of the economy, telling supporters at the Nebraska rally that the United States was experiencing a “Golden Age”.

“Right now we have the Golden Age of America,” Trump said. “Our nation is doing better now than it’s ever done before.”

The president has nevertheless faced criticism over high fuel and grocery prices, with Democrats seeking to make affordability a central issue in the midterm elections.

The diesel announcement also comes as agricultural producers in Nebraska and other rural states contend with increased operating costs.

Trump has separately proposed allowing more foreign beef imports in an effort to reduce meat prices for consumers, a move that has faced opposition from US ranchers who argue that additional imports could hurt domestic producers.

Trump’s latest fuel measure is expected to be closely watched by farmers, truckers and other diesel-dependent businesses as the administration seeks to ease price pressures before the midterm elections. (AP News)