U.S. gas prices have risen sharply, exceeding $4 per gallon largely due to the war in Iran.
In response, the Trump Administration is trying to lower fuel prices at least temporarily.
This month, the Environmental Protection Agency issued temporary emergency fuel waivers to allow the sale of E15 – a gasoline blend with 15 percent ethanol.
The EPA is also removing all federal impediments to selling an E10 blend – which contains 10% of ethanol – across the country.
Sale of E15 is usually restricted during the summer months under the Clean Air Act because of its higher volatility that causes the fuel to evaporate more easily during hotter weather, contributing to smog-forming emissions.
The EPA says the emergency waiver will temporarily remove those rules and blending limits on gasoline, giving the fuel market more flexibility.
The intent is to increase fuel supply and offer more fuel options without changing existing environmental protections.
“If now, 15% of your gasoline can come from something else, corn instead of oil, that in theory could reduce the price of gasoline,” says Derek Lemoine, an economics professor at the University of Arizona. “The problem though is that ethanol is more volatile especially in heat and it causes air pollution concerns that are worse than normal gasoline.”
The EPA’s waiver will be in effect from May 1 through May 20, but could be extended if needed.
According to the agency, there are about 3,000 gas stations that offer E15 nationwide, but Lemoine says that it is unlikely to affect gas prices by much throughout Arizona.
“The one thing to keep in mind is the price of gasoline is basically determined by the price of oil and the price of oil is determined by global markets,” he said. “And we’ve really dramatically shrunk the supply of oil in a way that’s probably more dramatic than any other shrinkage in the last 70 years even.”
As of late March, Iran’s closure of the Strait of Hormuz has stopped the flow of nearly one-fifth of the global oil supply, according to the Harvard Business Review.
About 20% of the world’s oil and liquefied natural gas (LNG) usually passes through the strait.
“Even though we do make a lot of oil, our oil market is linked to the rest of the world, just like anywhere else in the world,” Lemoine said.
According to the U.S. Energy Information Administration, the U.S. produces about 12.9 million barrels of crude oil per day.
“If oil is more expensive, the price of gasoline is going to be more expensive and there’s only so many ways to go around that,” Lemoine said.
In Arizona, gas prices have gone up more than one dollar in the past month, according to AAA.
The current average price of regular gas in Pima County is $4.469 and $5.896 for diesel fuel.
Governor Katie Hobbs took to X to thank Lee Zeldin, the EPA Administrator on X, after the temporary fuel waiver was issued, stating, “Thank you to [Lee Zeldin] for issuing a nationwide fuel waiver following my request for Arizona to receive relief. The price of gas has skyrocketed due to the war in Iran. This important waiver will help create supply certainty, bring prices down and help Arizonans get by.”
Hobbs requested a fuel waiver from the EPA on March 18.
Senator Ruben Gallego also thanked the agency in a statement, “Costs are already too high, and the last thing Arizonans need is more pain at the pump…The EPA and Department of Energy issued a temporary fuel waiver that will help lower gas prices and bring some relief to Arizona families.”
Arizona shoppers might also notice a change in pricing for corn-based products as a result of the waivers, Lemoine said.
“There is the potential now for increased prices of any food that uses corn and that’s a whole range of food products from livestock to anything with corn syrup to straight corn,” he said.
Lemoine added that in turn, farmers who grow corn might financially benefit.
