Crude oil and gasoline futures fell sharply Thursday on the possibility that federal regulators would grant waivers on gasoline formulas to Calif and NY, a move that could help ease prices and summer supply bottlenecks.
Calif has been fighting Clean Air Act’s fuel requirements since 1999
Calif seeks permission to make gasoline w/o required “oxygenate” additive of either ethanol or methyl tertiary butyl ether, or MTBE
Calif banned MTBE after discovering tendency to pollute groundwater; NY and CT instituted MTBE bans that began Jan. 1
Calif refiners now add ethanol instead of MTBE