Trump’s Vehicle Fuel Economy Rollback Helps Big Oil While Hurting Automakers

Some environmentalists have noted with schadenfreude that the auto industry is getting its just desserts now for pressing the Trump administration to weaken Obama-era fuel economy standards. While the auto industry may have originally just wanted some additional flexibility for compliance, instead they got a wholesale revocation of the program.

And this rollback means a worst-case scenario for the auto industry, with potentially years of litigation and uncertainty to come. In short, they won’t know what type of vehicles to produce for the next few years at least.

So if the auto industry didn’t want the administration to take this approach, why is it happening? The answer may involve the other industry that benefits from weakening fuel economy standards: Big Oil. As Bloomberg reported:

The Trump administration’s plan to relax fuel-economy and vehicle pollution standards could be a boon to U.S. oil producers who’ve quietly lobbied for the measure.

The proposal, released Thursday, would translate into an additional 500,000 barrels of U.S. oil demand per day by the early 2030s, about 2 to 3 percent of projected consumption, according to government calculations.

Apparently oil industry leaders have been quietly lobbying for this action, including Marathon Petroleum Co., Koch Companies Public Sector LLC, and the refiner Andeavor. In fact, on the KQED Forum show I participated on this past Friday, one of the guests supporting the rollback was from the Koch-funded think tank “Pacific Research Institute.”

So it looks like Big Oil doesn’t really care if the auto industry twists in the wind on the rollback, if it means the possibility of selling a lot more climate-destroying oil in the meantime.

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