Trump orders changes in biofuel rules to end quarrel between oil producing states and oil refiners

Refiners generate credits – known as RINs – when they mix biofuels with gasoline. Refiners who can not mix biofuels must purchase RINs from their competitors.

The new regulations under consideration include limiting credit trading to refiners and fuel importers, the official said. This would eliminate traders who are not tied to refiners but are allowed to trade in RINs. Refiners often blame these traders for sharp price swings that can increase compliance costs for small refineries.

INR prices were particularly volatile last year. According to analysts, Trump's decision to appoint billionaire investor Carl Icahn to the position of regulatory advisor fueled this volatility. Icahn holds a majority stake in refinery operator CVR Energy and has requested changes to the biofuel rules that would benefit refiners, but the administration has not adopted its ideas.

It is not certain that Trump's new proposals will appease any part of the debate.

Meaning. Grassley and Ernst rejected Cruz's proposal to cap RIN prices following a meeting at the White House in February.

Meanwhile, the American Petroleum Institute and US manufacturers of fuels and petrochemicals sent a letter to Trump last month rejecting the waiver of the E15.

"Such an approach is insufficient for refiners and inconsistent with your long-standing commitment to finding a solution that meets the needs of the biofuel and refining industries," the trade groups said.