There was good discussion of the Renewable Fuels Standard (RFS) during a Hill hearing this week. API supports the appropriate use of ethanol, biodiesel and other biofuels in transportation fuels, but, unfortunately, in some ways the standard is bearing out the law of unintended consequences.

API President and CEO Jack Gerard addressed the House energy and power subcommittee, noting that U.S. refiners have primary responsibility for meeting the RFS requirements, blending nearly 15 billion gallons of ethanol in gasoline. But the RFS’ requirements are producing some bad policy, Gerard said:

“EPA has allowed the RFS law’s volume requirements to drive decisions that are inappropriate and unwise.  The law has become increasingly unrealistic, unworkable, and a threat to consumers.  It ne... more »

More on the potential risk to America’s car and truck fleet posed by E15 – gasoline containing 15 percent ethanol that has EPA approval: Just-released research indicates that more than 5 million existing cars and light trucks, which EPA says are OK for E15 use, could develop engine problems as a result.

Why this discrepancy?  The Coordinating Research Council (CRC), a non-profit entity supported by the automotive and oil and petroleum industries, tested the durability of engines using tests that have been conducted for more than a decade to determine how well engines would hold up with a new fuel. 

On the other hand, the Department of Energy (DOE) and EPA tested the catalyst system and then used the results of those tests to say the engine would be fine.  It’s a bit like taking a rea... more »

Arthur Brisbane, The New York Times' public editor, is critical of the newspaper's recent coverage of the economic boom associated with natural gas development in Pennsylvania, Texas and other states. You can read his piece here.

Equally interesting is reaction to Brisbane's comments from the journalists who wrote and edited the story in question - basically telling Brisbane to take a hike. "We would not change a word," Richard L. Berke, the newspaper's national editor, is quoted as saying. No question, an ombudsman often travels a lonely road.

Others should decide for themselves whether The Times practiced good journalism. Brisbane has his doubts and lays out his case, starting with the article's use of loaded words like "Enron," "Ponzi schemes" and "dot-coms" to convey alarm about natura... more »

Myths can be stubborn - sometimes more stubborn than the facts themselves. Tax treatment of the oil and natural gas industry is Exhibit A.

API Tax Policy Manager Stephen Comstock set the record straight after an Ogden (Utah) Standard-Examiner editorial failed to recognize that oil and natural gas companies are taxed at a higher effective rate than other companies, paying more than their fair share of taxes.

"You're way off base suggesting the nation's major oil and natural gas companies don't already pay their fair share of taxes. ... They pay millions of dollars a day in income taxes at higher effective rates than most other companies. They also receive none of the grants, guaranteed loans and price supports provided to other industries."

Similarly, API Upstream Director Erik Milito took... more »

Wondering about the factors that cause the fluctuations in global oil and gasoline prices? News articles that have appeared over the past several days attribute the climb to instability in the Middle East, the decline in the dollar's value, and growing demand in China and India. A couple of days ago, Bill O'Reilly of the O'Reilly Factor once again blamed oil companies, asserting that they can raise prices at will. With all due respect to O'Reilly, it's clear that he doesn't understand how the markets work.

As we've explained on this blog, oil companies are price takers, not price makers. Oil companies find and supply crude oil to the marketplace, but the price is determined by buyers and sellers who put a value on oil through their transactions at commodities exchanges including The New Yo... more »