Trump to lift ethanol restrictions, could lower gas prices

President Trump will revise fuel guidelines to allow for the year-round sale of gasoline with higher concentrations of ethanol, Republican senators announced on Tuesday.

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.

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.

Lifting the ban has been opposed by oil refiners.

Since ethanol is cheaper to produce than gasoline, for some motorists it could bring down prices at the pump, which were at about $2.91 per gallon as of Tuesday afternoon, according to AAA. Last year at this time, the average price of gas was only $2.49.

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 before midterm elections, where Republicans hope farm communities will remain a key base of support.

The president is headed to an event in Iowa Tuesday night, where he is expected to address the ethanol regulations. Nearly 40 percent of the corn grown in the state is used for ethanol production, while Iowa corn is responsible for creating nearly 30 percent of U.S. ethanol.