Trump increases the use of ethanol in gasoline, appeases farmers before elections

Trump increases the use of ethanol in gasoline, appeases farmers before elections https://www.eresviral.com/wp-content/uploads/2018/10/Trump-aumenta-el-uso-de-etanol-en-la-gasolina-apacigua-a-los-agricultores-antes-de-las-elecciones

Trump increases the use of ethanol in gasoline, appeases farmers before elections







WASHINGTON / NEW YORK (Reuters) - US President Donald Trump launched an effort on Tuesday to increase the use of ethanol in the nation's gas tank, delivering a long-sought political victory to the country's Farm Belt. and irritating oil refiners before the legislative elections in November. 











FILE PHOTO: A gas pump that sells E15, a gasoline with 15 percent ethanol, is seen in Mason City, Iowa, United States, on May 18, 2015. REUTERS / Jim Young / File Photo





Trump announced the lifting of a ban on gasoline sales mixed with 15 percent ethanol, known as E15, at a closed-door meeting at the White House, Republican senators told reporters after the meeting. 

"My administration is protecting ethanol. ... Today we are unleashing the power of E15 to feed our country throughout the year, "Trump told a crowd of supporters at a rally in Council Bluffs, Iowa. 

The announcement culminated with a month-long effort by the White House to thread the needle between the interests of the rival oil and corn industry, by increasing the demand for ethanol and at the same time reducing costs for refiners. In the end, Trump is moving forward without the support of the oil refining industry, which wanted more in exchange for agreeing to lift the summer ban. 

The measure also aims to help the political fate of the Republican candidates in the Midwest with a difficult agricultural economy and the imposition of import tariffs by Trump and China. Polls show that the elections are very close in Iowa for the governor position and two seats in Congress. 

Trump told the rally that the Democrats "would end the ethanol" if they had the chance. "You'd better get out and vote for the Republicans," he said. 

Nancy Pelosi, the leading Democrat in the US House of Representatives The United States said in a statement: "Democrats remain vigilant to ensure that this new measure will generate real benefits for US farmers." 

Iowa is the largest producer of corn in the country, and farmers have been frustrated by falling corn and soybean prices hurt by the US-China trade war. 

"It's about time," said Warren Bachman, a 72-year-old corn and soybean farmer in Iowa. "With all the trade wars, tariffs and low crop prices, it seems we're taking it in the short and supporting all the load. " 

According to the American Automobile Association, since ethanol is cheaper than gasoline, the administration expects to lower pump prices, which currently average $ 2.91 per gallon, more than 40 cents more than this time a year ago. . 

The Environmental Protection Agency prohibits E15 summer sales in certain areas due to smog concerns. For the ban to be removed, you must draft and finalize a rule in the spring.  

"I am sure that this rule can be met before the driving season next year," US Agriculture Secretary Sonny Perdue told Reuters in an interview.  

Advocates of biofuels hope that the lifting of the ban will boost sales of ethanol. Geoff Cooper, executive director of the trade group Renewable Fuels Association, said that allowing sales of E15 throughout the year could double sales of the top ethanol blend of approximately 400 million gallons today.  

"It depends on how quickly new pumps are added ... the biggest impact will be in the longer term," Cooper said. He said the move was a great first step, but noted that he faced significant political and legal opposition. 

"We're happy, but we know there's still a long way to go," Cooper said.     

'CERTAYNTY FOR A LAWSUIT'     

The rule would join the restrictions in the multibillion-dollar biofuel credit trade industry sought by commercial refiners such as Valero Energy Corp and PBF Energy Inc. These rules will try to prevent parties from accruing credits and increasing the cost to comply with the biofuels mix the laws 

Refiners are required to mix increasing amounts of biofuels such as ethanol into the fuel reserve each year, or buy credits from competitors who do. The refining companies that buy the credits have complained about volatile prices. 

The EPA will consider forcing bidders, retailers and commercial houses to sell credits more quickly to reduce market volatility, a White House official said. 

But that is not enough for refiners. The American Petroleum Institute, the largest petroleum trade association in the United States. UU., Opposes lifting the ban, saying that E15 gasoline ruins older cars and potentially voids warranties. 

"The only certainty of today's actions is a demand," Chet Thompson, head of US fuel and petrochemical manufacturers, said on Tuesday. He said the industry would challenge the rule finalized in the courts, and said the EPA had acknowledged that it lacks the authority to change this rule. 

Last year, prices for biofuel credits increased to almost $ 1 each, close to a maximum of five years, as commercial refiners warned that the plants could be forced to close without federal action. Prices fell after the EPA expanded its use of exemptions by freeing small refiners from their obligations. 

The loans were quoted at approximately 12 cents each on Tuesday, traders said.  





Report by Jarrett Renshaw in New York and Humeyra Pamuk in Washington; Additional reporting by Steve Holland in Council Bluffs, Iowa; Edited by Marguerita Choy and Peter Cooney





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