Focus on U.S. immigration and U.S. investment: Recently, President Obama announced that the federal government will further raise the fuel economy standards for medium and heavy-duty trucks, hoping to further reduce oil consumption and carbon dioxide emissions.
According to the fuel economy standards effective from 2012, by 2025, the average fuel economy for new cars and light trucks in the United States must reach 23 kilometers per liter, nearly doubling the current standard. Obama stated: “Many people say we cannot reduce emissions while maintaining economic growth, but it now seems they are all wrong.”
According to Reuters, by March 2015, the U.S. Environmental Protection Agency and the U.S. Department of Transportation must draft new regulations for fuel efficiency of medium and heavy-duty trucks, with formal regulations to be issued by March 2016.
The new regulations will revise the existing fuel efficiency standards for large vehicles from 2014 to 2018, which currently set fuel efficiency requirements for large vehicles including semi-trailers, large trucks, freight trucks, buses, garbage trucks, heavy-duty pickups, and vans.
The U.S. government predicts that the first phase of implementing the truck fuel efficiency standards is expected to save 530 million barrels of oil. In 2010, heavy-duty vehicles accounted for 4% of registered vehicles in the United States, but they accounted for 25% of fuel consumption and greenhouse gas emissions in the transportation sector.
An informal coalition of large truck operators—the “Heavy-Duty Fuel Efficiency Leadership Organization”—welcomed the new fuel standards and praised the government’s approach of consulting the industry at the early stages of policy formulation.
If the new standards reduce fuel consumption in the United States or slow down oil demand in the next decade, domestic oil refining companies will not be significantly affected. The three major refining companies in the United States have already increased their export of refined oil products from their Gulf Coast refineries. Due to the lack of refining capacity in some countries, the demand for refined oil exports has surged. According to the U.S. Energy Information Administration, in November 2013, the United States exported 3 million barrels of refined oil per day. For the first time in 49 years, the United States became a net exporter of refined oil in 2011.
Establishing new truck fuel standards is another indication of the U.S. government’s commitment to addressing climate change. By requiring federal agencies to establish new standards, Obama can bypass Congress to take measures to mitigate climate change. However, there are currently significant divisions in Congress regarding climate change policy.
Meanwhile, during a recent visit to severely drought-stricken areas in California, Obama warned that global warming is exacerbating droughts and other extreme weather events. He stated: “Unless we take more action to reduce carbon dioxide emissions, this trend will only intensify.”
Shortly after Obama announced the increase in truck fuel economy standards, Secretary of State John Kerry delivered a speech on climate change in Jakarta, Indonesia. Subsequently, U.S. Secretary of Energy Ernest Moniz plans to announce a so-called “major decision” in the government’s energy strategy.
Additionally, Obama continues to request Congress to end the $4 billion annual subsidies for the oil and gas industry while urging Congress to establish a $2 billion “Energy Security Trust” to support the development of new energy vehicles. The trust funds will primarily come from federal revenues from oil and gas development.
