Fuel Talk: White House Tries to Balance Oil and Biofuel Interests

The White House recently met with oil refiners and biofuel producers to tackle a long-standing issue about biofuel blending rules. The Trump administration is close to deciding whether larger refiners should compensate for the billions of gallons of biofuels that were exempted for smaller refineries. This decision was supposed to be made by the end of October but got delayed due to the government shutdown. These meetings show the administration's struggle to satisfy both the oil industry and the farm sector, which are both influential politically. The oil industry argues that blending mandates risk refinery jobs, while farmers say the exemptions have hurt demand for corn-based ethanol and other biofuels. The outcome could affect fuel prices, farm incomes, and energy policies heading into the next year. The talks also discussed making E15, a gasoline blend with 15% ethanol, available all year. The administration might combine this with changes to the small refinery exemption program to gain support from both industries. Under the U. S. Renewable Fuel Standard, refiners must blend biofuels into the fuel supply or buy compliance credits. Small refiners can get exemptions if they show economic hardship. The Environmental Protection Agency has cleared a backlog of exemption requests dating back to 2016. The EPA estimates that 2. 18 billion gallons of blending obligations will be waived from 2023 through 2025. Biofuel groups want non-exempt refiners to make up for the waived gallons to maintain demand for renewable fuels. However, refiners oppose this, saying it would increase their regulatory costs. The American Petroleum Institute, representing the oil industry, appreciated the administration's efforts to find a practical solution on E15 and exemption reforms.