• EPA still reviewing comments; no end-of-year decision expected
• Delay folds quotas into broader oil-agriculture policy talks
• Uncertainty complicates contracts, hedging, and investment decisions

Dec 12 (Reuters) - The Trump administration is not expected to finalize 2026 biofuel-blending quotas before the end of this year, according to three sources familiar with the situation, extending uncertainty over a policy closely watched by the rival oil and agricultural sectors.

The slowdown would throw one of the administration's most consequential energy policy choices into next year and folds the highly anticipated quotas into a growing cluster of interlocking decisions the White House is weighing on biofuels policy.

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Together, the moves have raised expectations the administration may look to strike a broader - albeit elusive - agreement between rival oil and agricultural interests.

The Environmental Protection Agency, which administers biofuels policy, has scheduled meetings with stakeholders on the quota rule early next, two sources told Reuters, a sign that the issue will be pushed into next year.

A third source also said the EPA's decision was unlikely by the end of this year.

The sources spoke about the matter on condition of anonymity.

The EPA told Reuters it was still reviewing public comments on the volume requirements and declined to offer any guidance on timing. The volume mandates are administered under the Renewable Fuel Standard (RFS), the federal program that mandates the blending of biofuels such as ethanol and biodiesel into the U.S. fuel supply.

A delay in finalizing the mandates is important because fuel makers, farmers and commodity traders use them to lock in supply contracts, hedge volatile crop and energy markets, and justify investments in new production capacity.

Without clarity on next year's quotas, companies say they are forced to hold back on deals and delay spending decisions that shape biofuel output and margins.

WHITE HOUSE LOOKS FOR COMMON GROUND

Earlier this year, the EPA proposed raising total renewable fuel requirements for 2026 and 2027, significantly increasing targets for advanced biofuels and biomass-based diesel targets while tightening rules on the use of imported biofuels.

The EPA had initially been expected to finalize the proposal by the end of October.

The quotas have increasingly been swept into a broader set of critical energy and agricultural policy decisions the administration is weighing in the coming weeks - issues that appear separate on their own but could be linked as part of a wider bargain between rival oil and agricultural interests, the sources said.

Those issues include legislative efforts to allow year-round sales of gasoline containing higher blends of ethanol, a proposal to penalize imported biofuels and feedstocks, and unresolved questions over whether and how larger refiners could be required to make up for gallons exempted from the RFS.

The White House has held several meetings in recent weeks with oil and agricultural groups in hopes of finding common ground.

Asked whether these issues are becoming increasingly connected, the EPA said it is "committed to strengthening American energy security and supporting American farmers."

https://www.reuters.com/sustainability/climate-energy/trump-administration-unlikely-finalize-2026-biofuel-quotas-this-year-sources-say-2025-12-12/