“It is not too late to fix this problem if the EPA acts quickly.”
Billionaire investor Carl Icahn has called on the top U.S. environmental regulator to make changes to a market for renewable fuel credits or else risk “the mother of all short squeezes” that could bankrupt refiners.
In a letter to Environmental Protection Agency administrators seen by Reuters on Monday, Icahn said “a number” of refiners could go bankrupt if the playing field is not leveled to stop disfavoring independent refiners such as CVR Energy, in which Icahn owns an 82% stake.
Icahn expressed worries about the market for renewable identification number (RIN) credits, which the EPA calls the “currency” of a renewable fuel standard program designed to reduce reliance on imported oil and the emission of greenhouse gases.
“The RIN market is the quintessential example of a ‘rigged’ market where large gas station chains, big oil companies and large speculators are assured to make windfall profits at the expense of small and mid-sized independent refineries which have been designated the ‘obligated parties’ to deliver RINs,” Icahn wrote.
“As a result, the RIN market has become ‘the mother of all short squeezes,'” he added. “It is not too late to fix this problem if the EPA acts quickly.”...MORE