Trump lifts year-round ethanol restrictions, could lower gas prices
The Trump administration on Friday announced that it would allow for the year-round sale of gasoline with higher concentrations of ethanol.
The action addresses a rule the Environmental Protection Agency had in place preventing the sale of so-called E15 fuel, which contains 15 percent ethanol and 85 percent gasoline, between June 1 and Sept. 15. The purpose was to prevent air pollution and curb dependence on foreign petroleum, but the ban has stopped some retailers from selling E15 at all because of the need to change out pumps.
President Trump promised to end the ban last year, as corn farmers were voicing a concern over the trade war between the U.S. and China, which remains ongoing. Corn is widely used to domestically make ethanol.
Gasoline generally contains about 10 percent ethanol. Allowing for the year-round sale of E15 will give farmers more avenues to sell corn, which could bolster revenue especially when prices are low.
Since ethanol is cheaper to produce than gasoline, for some motorists it could bring down prices at the pump, which were at about $2.82 per gallon as of Friday afternoon, according to AAA. Last year at this time, the average price of gas was $2.95.
"The year-round approval of E15 will mean another outlet for corn growers, and lower prices for consumers that want to fill up with E15, which is generally offered 5 to 10 cents per gallon lower than E10 gasoline," Patrick DeHaan, a senior petroleum analyst at GasBuddy, told FOX Business. DeHaan noted, however, that E10 is the default regular fuel sold across most of the counry.
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Lifting the ban has been opposed by oil refiners.
The announcement comes as farmers have been voicing concerns over a growing trade war between the White House and China, which has featured tit-for-tat tariff implementation. It also comes one day after the president threatened to impose 5 percent tariffs on goods from Mexico.