Ethanol Industry: Gasoline Supply Impacted by Mother Nature

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Ethanol Industry: Gasoline Supply Impacted by Mother Nature

As refining shortages contribute to high gasoline prices -- since July 1, gas prices have increased on average more than 40 cents -- flooding and lightening-related fire incidences, especially in the ethanol-friendly Midwest, have closed refineries in some parts of the country, according to the Ethanol Promotion and Information Council.

"If these shortages persist, my fuel stations could run low on fuel supplies," Gary Wright, vice president of Wright Oil, Inc., based in Central South Kansas, said in the statement. "My current gasoline price is $3.36 but my 85-percent ethanol-blend is selling for $2.80 per gallon. With the number of ethanol plants producing in my area, I will be able to keep my E85 price stable."

The United States gasoline demand has outpaced its refining capacity. Globally an estimated 84 million gallons of gasoline are refined per day, but an equal number of gallons are used, EPIC noted.

"At a time when global gasoline demand continues to rise, the unfortunate occurrence of multiple weather-related incidents, affecting the Midwest oil refining industry [in particular], are further highlighting this country's need for diversification of our transportation fuel needs," said Tom Slunecka, EPIC's executive director. "In the region hardest hit by these incidences, the ethanol industry has been providing alternatives to petroleum-based gasoline refineries. This demonstrates renewable fuels like ethanol and biodiesel are essential to continuing economic viability and the American way of life."

States affected by the numerous refineries that have incurred damage are: Nebraska, Kansas, Missouri, Okalahoma, Minnesota, North Dakota, South Dakota, Minnesota, Iowa, Illinois, Indiana, and parts of Ohio, according to EPIC, a nonprofit group of ethanol producers.

The ethanol industry has grown to produce over 5.5 billion gallons emanating from more than 100 ethanol production plants diversely located across the same region.