By Jarrett Renshaw
March 18 (Reuters) - The Trump administration is expected to announce soon that it will temporarily lift federal smog-cutting restrictions on summer-blend gasoline to curb rising energy prices stemming from the Iran conflict, according to three sources familiar with the matter.
The move would make standard gasoline cheaper by not forcing refiners and retailers to switch to more costly summer blends of gasoline, while also allowing fuel retailers to continue selling gasoline blended
with 15% ethanol, known as E15, throughout the summer driving season when stricter rules normally limit its use in much of the country.
Analysts say the change could shave several cents per gallon off retail prices and provide relief to both consumers and refiners struggling with tight fuel supplies. Retail U.S. gasoline prices are currently at their highest levels since late 2023 at $3.84 for a gallon of regular, up from $2.92 a month ago, according to AAA.
The U.S. normally switches to summer gasoline blends to reduce air pollution. These blends have lower volatility, measured by Reid Vapor Pressure, limiting evaporation that can contribute to smog in warmer weather.
Oil and gasoline prices have surged as the Iran conflict has disrupted global supply. U.S. crude topped $100 a barrel for the first time since the 2022 Russia-Ukraine shock.
In a statement, the U.S. Environmental Protection Agency said the agency will work with states to reduce unnecessary costs and uncertainty to ensure that gas prices "remain affordable for all Americans through the summer. The agency is monitoring the fuel supply with industry and federal partners."
A White House official said no final decision about a temporary lift of summer gasoline restrictions has been made, and said the reporting was premature.
The EPA oversees fuel standards.
The expected move is part of a broader effort by the White House to contain the economic and political fallout from rising energy costs as peak summer driving season approaches.
(Reporting by Jarrett Renshaw; editing by Richard Valdmanis, Nick Zieminski and David Gaffen)
