Three sources involved in the discussions said that the waiver would combat rising pump prices and that the White House is considering removing U.S. gasoline environmental rules aimed at reducing summertime smog.
Refiners and blenders are required to avoid lower-cost components, like butane in summer gasoline, but the White House is considering suspending that rule to help lower fuel costs. The components help elevate the Reid vapor pressure, or RVP, which contributes to smog at higher levels, particularly in the hot summer months.
President Joe Biden's administration has lifted the requirement for summer sales of E 15, a lower-price, high-ethanol gasoline. The waiver would apply to all grades of gasoline, the sources said. They said no final decision has been made.
There was no immediate response from the White House to a request for comment. Outside groups, particularly governors, have been lobbying the White House to issue a waiver.
Biden wants to fight inflation and high pump prices ahead of congressional elections in November. The Republicans trying to take control of Congress have bludged Democrats with the issue and the White House has adopted an 'everything is on the table' approach to curbing the price spike.
U.S. gasoline futures dropped by more than 4% in post-settlement trade to as low as $3.6314 a gallon, but eased further after Reuters reported the move was under consideration.
The price of a gallon of regular gasoline has gone up 50% in the last year, to more than $4.59 on average nationally, according to the American Automobile Association.
Ten states and the District of Columbia are already paying more than $5 a gallon, with California's statewide average surging to more than $6 a gallon.
Summer-blend gas, which retailers must sell from June 1 to Sept. 15, is required under the Clean Air Act's 1990 amendments. The US government has waived those requirements regionally or nationally to deal with hurricanes or other supply issues in the past.
After the March COVID outbreak, a buildup of winter-blended fuel in storage tanks led to a drop in demand for gasoline, the administration lifted summer gasoline requirements in May, 2020 for 20 days.
In August, Biden's administration issued a waiver of RVP requirements in Louisiana and Mississippi after Hurricane Ida.