RFA: To early to tell impact of Saudi-Russia oil deal on ethanol
As President Donald Trump planned to meet with U.S. energy leaders today about the Saudi-Russia deal to stabilize the oil industry, Renewable Fuels Association President and CEO Geoff Cooper told The Hagstrom Report it is too early to tell what the deal might mean for ethanol.
“It is far too early to know what may ultimately arise from possible negotiations between Saudi Arabia and Russia,” said in an email Thursday.
“There is no deal at this point and it would be premature to speculate on how ethanol may be affected,” Cooper said.
“That said, if the two countries do agree to significant production cuts and oil prices experience a sustained increase, it would be somewhat helpful to the ethanol industry. Still, higher oil and gasoline prices are not going to solve the larger problem facing our industry today.
“We’re still dealing with a dramatic drop in fuel consumption due to the COVID-19 stay-at-home mandates. With ethanol demand at a 25-year low and storage tanks plumb full, many plants are idling and producers are considering furloughs and layoffs
“We look forward to the day when the White House gives the plight of ethanol producers and farmers half as much attention as the oil industry is getting,” Cooper said.
“While a cut in Saudi and Russian oil production and higher oil prices might help ethanol some, what we really need is a commitment to faithful enforcement of the Renewable Fuel Standard and a promise to immediately abide by recent federal court decisions that restore integrity to the RFS.”
Bloomberg reported that the U.S. oil industry is bitterly divided over the situation.
The Wall Street Journal reported today that OPEC officials said Saudi Arabia and Russia are pressing the U.S. to coordinate oil output cuts in an attempt to stabilize prices as the demand for crude plummets amid the coronavirus pandemic.
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