FTC to Examine Claims of Oil Cos. Blocking Renewable Fuels

WASHINGTON D.C. -- The Federal Trade Commission (FTC) will investigate allegations that Big Oil companies are blocking the distribution of renewable fuels.

According to Bloomberg, FTC Chairwoman Edith Ramirez said the agency will "evaluate" claims that oil companies are requiring retailers to carry premium gasoline. The FTC is launching the investigation in response to a written request authored by Sens. Charles Grassley (R-Iowa) and Amy Klobuchar (D-Minn.)

The senators asked both the Justice Department and FTC to determine if the alleged blocking of the introduction of higher ethanol blends violated antitrust law. "We have heard allegations that the oil industry is mandating retailers to carry and sell premium gasoline, thereby blocking the use of current retail infrastructure to sell renewable fuel," they wrote in their letter to the FTC.

Reid Porter, spokesman for the American Petroleum Institute, responded in an e-mail to the news outlet that "the allegations are a distraction from the fact that the Renewable Fuel Standard [RFS] is broken."

The RFS requires refiners to use 13.8 billion gallons of ethanol this year and 15 billion by 2015. Ethanol is typically combined with gasoline in a formula of up to 10 percent, which is referred to as the blend wall.