A lack of certainty on how the US Environmental Protection Agency will respond to petitions for small refinery exemptions from biofuel blending mandates will continue to keep RINs in a tight range, sources said July 17.
D6 RINs will "just float between 45 and 50 cents," said one market participant.
S&P Global Platts assessed current-year D6 RINs at 46.75 cents/RIN July 17, down 0.25 cent from July 16.
Current-year D6 RINs have hovered in the mid- to high 40s cents/RIN range since the end of May.
Volatility in RINs markets has dropped to multi-month lows, based on S&P Global Platts data, as refiners have bought just enough of the credits to cover obligations.
Neither buyers nor sellers seem willing to blink as the market waits for the US Environmental Protection Agency to say if it will grant the petitions, effectively removing the need for potentially billions of RINs.
The most recent EPA data, released July 16, showed no additional petitions had been granted, but there was a new petition for each year from 2011-2016.
A recent court decision signaled EPA would need to grant fewer exemptions, but refineries that received an exemption in the past could continue to receive exemptions in the future.
That led small refineries that had not received a small refinery exemption to apply for all possible years to potentially be grandfathered into future exemptions.
A refinery with less than 75,000 b/d of throughput capacity can petition the EPA for an exemption from federal biofuel blending mandates. EPA's administration of the waiver program has been a hot button issue in the biofuels and oil industries.
The biofuel industry hailed the decision from the court to limit the agency's ability to grant the exemptions, but oil interests have supported retroactive exemptions as a way to remain eligible for future waivers.
