Page 10 - NorthAmOil Week 24 2021

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Biden mulling relief for US oil

refiners from biofuel quotas

US US President Joe Biden’s administration is con- by large companies such as ExxonMobil.
sidering giving oil refiners more relief from bio- The prices of renewable identification num-
fuel mandates, said anonymous sources quoted ber (RIN) credits – the compliance mechanism
by Reuters in an exclusive. The oil industry says used for the RFS – sharply increased through
the mandates are expensive and could lead to April because of rising global demand for bio-
jobs losses if refineries are closed. fuel feedstock. RIN prices are now higher than As of May 28,
US law, under to the Renewable Fuel Stand- at any time during the 13-year history of the
ard (RFS) programme, requires petrol refiners to programme, the Energy Information Adminis- corn fuel ethanol
blend biofuel into their fuel supply, or buy credits tration (EIA) reported earlier in June.
from those that do blend in the renewable fuel. As of May 28, corn fuel ethanol D6 RIN prices D6 RIN prices
Small oil refineries, with a capacity of less had risen by 129% since the beginning of the
than 75,000 barrels per day (bpd), can ask for an year, and biomass-based diesel D4 RIN prices had risen by
exemption if they would face financial hardship had increased by 96%. Biomass-based diesel is 129% since the
by adhering to the RFS. made from soybean oil.
Biden, who has made increasing the use of Reuters reported that Democratic senators beginning of the
renewable energy because of climate change a Chris Coons and Tom Carper of Delaware have
cornerstone of his administration, faces pressure held at least two recent discussions with Michael year.
from trade unions and from senators in whose Regan, head of the US Environmental Protec-
states the struggling refineries are located. Gaso- tion Agency, which administers the RFS, to dis-
line demand in the US slumped during the lock- cuss relief for refiners. Delaware has one small
down for coronavirus (COVID-19). refinery.
The RFS, to boost the biofuel industry, has Two of the sources told Reuters that options
strong support in the Midwest where much of such as a general national exemption, lowering
the feedstock for ethanol – corn – is grown. the volume of biofuel that refiners must blend,
Under the previous US administration of or creating a price cap on RINS were discussed.
Donald Trump, a controversy arose because of Only eight refineries are now left out of the 17
the number of oil refiners who gained exemp- that operated on the US East Coast in 2000, the
tions, even including some small refiners owned news service reported.™

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