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30 March 2026 at 03:52 pm IST
A sharp divide has emerged between the Trump administration and the U.S. refining sector after the Environmental Protection Agency finalized record biofuel blending mandates for 2026 and 2027—at a time when fuel prices are already surging due to the ongoing Iran conflict. The new rules, issued under the Renewable Fuel Standard, require refiners to blend 26.81 billion credits (RINs) in 2026 and 27.02 billion in 2027—the highest levels ever set. The policy is designed to support U.S. farmers and biofuel producers, particularly those tied to corn-based ethanol and biodiesel. However, refining groups warn the move could worsen inflationary pressure at the pump. Chet Thompson, head of the American Fuel & Petrochemical Manufacturers, criticized the decision, arguing that imposing higher blending costs during a geopolitical energy shock risks further driving up gasoline and diesel prices. U.S. fuel prices have already climbed sharply, with gasoline nearing $4 per gallon and diesel surging even higher. The mandates also include the reallocation of 70% of previously waived blending requirements from earlier years, adding further compliance costs for refiners. Industry representatives estimate that existing biofuel mandates have already increased fuel prices by roughly 25 cents per gallon, with further increases expected under the new targets. In contrast, agricultural and biofuel groups have welcomed the move. Organizations like the National Corn Growers Association say the policy provides much-needed support to farmers facing economic uncertainty. The Renewable Fuels Association also backed the decision, though it had pushed for full reallocation of previously waived volumes. EPA Administrator Lee Zeldin framed the policy as part of a broader effort to strengthen American agriculture and domestic energy production. Additional provisions aim to favor U.S.-produced biofuels by reducing credit eligibility for foreign feedstocks starting in 2028. The policy highlights a growing tension within the administration’s energy strategy—balancing support for fossil fuels, agricultural interests, and consumer affordability—at a moment when global energy markets remain highly volatile.
