Renewable fuel company Gevo (NASDAQ:GEVO) is climbing for the second straight day as President Joe Biden’s administration eyes ethanol-based energy systems. GEVO stock is up 1.6% at the time of writing on an upcoming Biden energy announcement.
So, what’s going on with Gevo lately?
Well, Gevo is in the green for the second time just two days into the week on a promising potential announcement. Indeed, as per a statement from the White House, President Biden plans to expand biofuel-blended gasoline this summer. Specifically, Biden plans to suspend a federal law banning the sale of higher ethanol blend gasoline this summer.
The move comes as an attempt to ease currently sky-high fuel costs, a consequence of Russia’s invasion of Ukraine. Ahead of an important midterm election, some political analysts believe the move will enhance his electability should fuel costs recede following the move.
Accordingly, this is likely what’s pushing Gevo up today, a specialized producer of ethanol-based fuels. So, what else do you need to know about Gevo’s potential gains from the news?
GEVO Stock Primed for Growth Ahead of Loosened Ethanol Regulation
Typically, gasoline in the U.S. is mixed with, at most, 10% ethanol, referred to as E10. This is due to the potential for smog stemming from the fuel, especially in the summer.
Biden will likely allow the Environmental Protection Agency (EPA) to issue an emergency waiver allowing the sale of up to 15% ethanol, or E15, between June and September this year, typically a period in which E15 is prohibited for sale.
The waiver will supposedly lower gas prices an average of 10 cents across the Midwest and South.
As such, it comes as little surprise that Gevo, a well-known ethanol-based fuel maker, is benefitting from the news. Gevo joins Fusion Fuel Green (NASDAQ:HTOO) and other ethanol-based gas makers in their collective rise today.
Coming hot off a recent deal with Delta Air lines (NYSE:DAL), Gevo investors are likely pleased with recent news.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.