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Oil executive says ethanol subsidies skew fuel market

By Robert Frederick, KWMU

St. Louis – A major oil executive blasted U.S. energy policy concerning ethanol production.

Corn-based ethanol production is a major focus of Missouri and Illinois governments to meet future energy needs.

During a talk in St. Louis Thursday, Shell Oil president John Hofmeister said the tariffs and subsidies put in place by the government to support ethanol production are unfair.

"It is wrong," Hofmeister said. "We think that is creating an un-level playing field in the marketplace, and it actually leads to higher-cost ethanol overall, and what we've seen in this country is a rise in the price of ethanol, from year to year, to where ethanol now in many cases costs more than gasoline."

While Shell does not produce ethanol, the company would greatly benefit if the U.S. drops the tariffs and subsidies.

According to the Washington Council on International Trade, the company is the world's largest ethanol distributor.

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