(Adds comment from refinery trade group)
By Valerie Volcovici
WASHINGTON, March 3 (Reuters) - The Obama administration on Monday announced new fuel and automobile rules to cut soot, smog and toxic emissions, which it says will reduce asthma and heart attacks in the United States.
The rules unveiled by the Environmental Protection Agency will cut sulfur levels in gasoline by more than 60 percent and will be phased in between 2017 and 2025.
Health advocates praised the move, while a petroleum refiners' group called the compliance schedule unrealistic and warned that these regulations and others would eventually raise gasoline prices throughout the country.
"By reducing these pollutants and making our air healthier, we will bring relief to those suffering from asthma, other lung diseases and cardiovascular disease, and to the nation as a whole," said Dr. Albert Rizzo, former chairman of the American Lung Association.
Once fully in place, the standards will help avoid up to 2,000 premature deaths per year and 50,000 cases of respiratory ailments in children while adding only an average of 1 cent per gallon to the cost of gasoline, the agency estimated.
Charles Drevna, president of the American Fuel and Petrochemical Manufacturers, rejected the agency's cost estimate.
"We are rapidly approaching California gasoline as the nationwide fuel," Drevna said at the IHS CERAWeek energy conference in Houston.
Retail gasoline prices in California are generally the most expensive in the continental United States due to strict environmental rules and other factors.
The EPA said the sulfur rules include a program to help refiners and importers meet the new standard, and gives smaller refiners more time to comply.
The standards are an attempt to cut the sulfur content of gasoline to 10 parts per million from 30 ppm currently.
Automakers worked with the EPA to craft the rules and generally welcomed the national standard for gasoline.
QUESTIONS ABOUT COST
The EPA and the American Petroleum Institute, a lobbying group for the U.S. energy industry, sparred over the potential health benefits and costs of the rules.
The EPA estimated that the final standards would provide up to $13 in health benefits for every dollar spent to meet the standards.
The standards will have an average cost of about $72 per vehicle in 2025, the agency said.
But the API said the new rules would result in negligible health benefits and undue costs.
"This rule's biggest impact is to increase the cost of delivering energy to Americans, making it a threat to consumers, jobs and the economy," said Bob Greco, director of the API'S Downstream Group. The organization estimates the rules would increase gasoline prices by 6 cents to 9 cents per gallon.
EPA Administrator Gina McCarthy told reporters on a conference call that the benefits far outweighed the costs.
"The estimate that API and others are relying on is an outdated estimate of what they thought we would be proposing," she said.
Nor did they account for the compliance flexibilities the EPA added to the rule before the final release, she added.
"People will see immediate benefits in 2017," she said, and the estimated cost of under a penny per gallon of gasoline would not take effect until 2025, when the rule is fully in place.
Frank O'Donnell, president of nonprofit group Clean Air Watch, said Monday's rule was "the most significant move to protect public health that the EPA will make this year" and that the oil industry's fears about costs were often overblown.
"Let's remember the oil industry has cried wolf so many times," O'Donnell said, "and it's doing it again here." (Additional reporting by Ayesha Rascoe in Houston; Editing by Ros Krasny, David Gregorio, Lisa Von Ahn and Lisa Shumaker)