The US Environmental Protection Agency (EPA) has issued an emergency fuel waiver to help reduce the effects of fuel shortages in four Midwest states.
The request for the waiver was made by governors from Illinois, Michigan, Wisconsin and Indiana after oil giant ExxonMobil shut down its oil refinery in Joilet, Illinois, after a storm on 15 July.
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The EPA concluded along with the US Department of Energy (DOE) that the waiver is “necessary and appropriate… action to minimise or prevent disruption of an adequate supply of gasoline for consumers”.
The Clean Air Act allows EPA administrator Michael S Regan, in consultation with the DOE, to waive certain fuel requirements to address shortages.
Regan determined that “extreme and unusual fuel supply circumstances exist” as a result of the ExxonMobil refinery shutdown. He granted a temporary waiver to help ensure gasoline supplies in the affected areas until normal supply can be restored.
The closure of the 251,800 barrel-per-day oil refinery has led to increased gasoline prices with a shortage of supply. The waiver is set to temporarily remove requirements on low Reid vapor pressure (RVP) for both conventional and reformulated gasoline until 20 August.
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By GlobalDataGasoline with high RVP evaporates more easily that gasoline with low RVP, potentially increasing the amount of ozone pollution and smog build-up. To mitigate impacts on air quality, the Clean Air Act requires that waivers be “limited as much as possible in terms of their geographic scope and duration”.
According to the American Automobile Association, before the waiver was in place, the price of gasoline across the four states reached more than $3.45/gal. The price is expected to decline now the waiver is in place.
According to data from the US Energy Information Administration, published by Reuters, gasoline stockpiles in the Midwest dropped by 2.3 million barrels over the past two weeks.
The EPA has been known to reject similar fuel waivers in the past.
In March, the EPA denied a petition from the American Petrochemical and Fuel Manufacturers for a partial waiver of the 2023 cellulosic biofuel standard under the Renewable Fuel Standard. Last month, the federal court rejected the EPA’s decision in 2022 to deny small oil refineries temporary waivers from the nation’s biofuels blending programme.
ExxonMobil’s Joliet refinery is expected to resume operations in August.
