WASHINGTON—The Environmental Protection Agency on Tuesday proposed reducing the amount of ethanol and other biofuels that must be blended into gasoline this year and retroactively lowered last year’s mandate, in a win for refiners who warned that raising the requirement would lift prices at the pump.
The decision comes as the price of ethanol, the most-dominant biofuel, has risen to its highest level in a decade. While U.S. gas prices are driven by the price of crude oil, refiners say ethanol prices have contributed to higher prices at the pump, though gasoline has dipped from recent highs.