US senators urge report on blocked ethanol

Two US senators have urged federal regulators to investigate allegations made by a biofuel trade group that the oil industry uses 'strong-arm tactics' to block the extensive use of higher blends of ethanol in petrol.

A report produced by the Renewable Fuels Association argues that major oil companies discourage the sale of ethanol by implementing levels of 15% per gallon (E15) and 85% per gallon (E85), by forming distribution contracts that make it too expensive or unworkable for franchises to offer blends.

'This new report underscores the need for the Federal Trade Commission (FTC) to look into these allegations, and I will continue pushing to ensure that consumers have access to the cheaper, cleaner fuels they deserve,' Senator Amy Klobuchar, who chairs the Senate judiciary committee's antitrust panel, said in a statement.

The Renewable Fuel Standard (RFS) demands higher amounts of ethanol and biodiesel to be blended into US fuel supplies through to 2022.

Klobuchar and Senator Chuck Grassley have pressed the FTC for almost a year to probe whether oil industry practices regarding ethanol violate antitrust laws. At present, it is unknown whether the agency has taken action on this request.