EPA Issues Emergency Waiver to Address Fuel Shortages

By Shariq Khan and Rahul Paswan
Reuters

The U.S. Environmental Protection Agency (EPA) issued an emergency waiver on Thursday to alleviate fuel shortages in four Midwest states due to the shutdown of the Joliet, Illinois, refinery.

Exxon Mobil shut down the 251,800 barrel-per-day Joliet refinery following a power outage after a storm on July 15. Despite power restoration by July 24, the refinery is expected to restart operations only in mid-August, according to industry monitor IIR Energy.

The EPA’s waiver applies to Michigan, Wisconsin, Indiana, and Illinois, temporarily suspending federal anti-smog regulations that mandate the sale of less volatile, more expensive gasoline during summer. Such waivers are typically issued in response to unexpected supply disruptions.

The waiver is valid through August 20 and was requested by the governors of the affected states. Gasoline prices have significantly increased in the Midwest due to the refinery outage, with Illinois prices rising nearly 18 cents to over $4 a gallon as of Thursday, according to GasBuddy.com data.

Michigan’s prices climbed by 15 cents and Wisconsin by 14 cents, despite a slight decline in the national average price during the same period.

Analyst Patrick De Haan from GasBuddy expects prices to decrease in the coming days because the waiver allows Midwest suppliers to utilize more types of gasoline, thus expanding their available supply. He stated, “This should certainly alleviate some of the price pressure.”

As of July 26, gasoline stockpiles in the U.S. Midwest fell by 2.3 million barrels to 45.81 million barrels, the lowest level since November, based on U.S. Energy Information Administration data.