Trump Considers Doubling Refinery Exemptions to Lower Gas Prices

President Donald Trump and U.S. officials are considering a significant expansion of the small refinery exemption program to lower gasoline prices amid the war with Iran and support Republicans in the November midterm elections. The administration may double exemptions from approximately 950-990 million credits to 1.8 billion, allowing more oil refineries to opt out of federal renewable-fuel blending requirements.

To mitigate the impact on the Farm Belt, officials discussed increasing 2027 biofuel quotas by roughly 500 million gallons. This potential move follows a recent decision by the administration to increase the mandated amount of renewable fuels in the national gasoline supply for 2026 and 2027.

A coalition of farm and biofuel groups, including the National Farmers Union and Renewable Fuels Association, urged the president to reject the expansion. Grant Kimberly of the Iowa Biodiesel Board warned that doubling these exemptions could destroy approximately 500 million gallons of biomass-based diesel demand and cost U.S. soybean farmers roughly $1 billion in lost revenue. Senator Joni Ernst characterized the move as a handout to oil companies that would crush demand for corn and soybeans. A final decision is expected by the end of August.