An expert on energy markets warns that gas prices would jump almost immediately if the U.S. Environmental Protection Agency were to grant Texas Gov. Rick Perry’s request for a partial waiver of the renewable fuels standard.
“Our analysis shows that $5 gasoline will just be the beginning,” said Tom Waterman, energy market writer and publisher. “Prices in California within one month would reach $5.75 per gallon and head to $6 per gallon by summer’s end. The rest of the country will follow."
He added that U.S. refiners would have to find about 1.6 million barrels or 68 million gallons of gasoline per day immediately. He sees that as a fact, if EPA rules in Texas' favor.
Waterman’s insight aligns with what others also have argued-- that corn-based ethanol has helped keep gasoline prices from being even higher, by reducing the amount of petroleum needed in the United States. According to the Center for Agricultural and Rural Development at Iowa State University, growth in ethanol production has caused retail gasoline prices to be lower (up to 40 cents per gallon) than would otherwise have been the case.
Waterman has been writing about oil, gas, electricity and renewable fuels for 23 years, including publishing Btu, a leading information source in the natural gas and electricity markets. He also publishes a weekly petroleum publication known as MarketWire, and The Ethanol Monitor in 2005.
Source: National Corn Growers Association