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Latest market news

US Group II base oil margins fall for 7th week

  • Market: Oil products
  • 01/07/25

Domestic Group II base oil margins over feedstocks and competing fuels extended their decline for a seventh consecutive week on elevated feedstocks and firmer competitive fuel prices.

The Argus domestic spot US Group II N100 premium to four-week average low-sulphur vacuum gasoil (VGO) dropped to $1.28/USG for the week ended 27 June, from $1.30/USG the week prior. Margins remained below year-earlier totals of $1.36/USG.

The Argus domestic spot US Group II N100 premium to four-week average US Gulf coast diesel was $1.00/USG, down from $1.06/USG the week prior. Margins also remained below year-earlier totals of $1.13/USG.

US Group II base oil spot prices were flat because muted demand outweighed fewer spot volumes.

Group II light-grade supplies are limited, and domestic re-refiners are still working to catch up on orders following a heavy turnaround season.

Mid-grade supplies are more balanced because of recent exports to South America and Asia. Heavy grade supplies are not as lean as light grade material, but some buyers are noticing more limited availability. Other buyers are not having issues obtaining spot volumes.

Four-week average vacuum gasoil (VGO) rose for a seventh consecutive week because of persistent tightness. Margins for fluid catalytic crackers (FCC) also increased. Four-week average diesel prices have steadily increased since 30 May.

The low-sulphur VGO premium to four-week WTI crude narrowed further to $12.79/bl from $13.13/bl the week prior.

By Karly Lamm

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16/12/25

EU eases ICE phase-out with 2035 CO2 car target: Update

EU eases ICE phase-out with 2035 CO2 car target: Update

Adds details on credits, transport commissioner comment in paragraphs 4-6 Brussels, 16 December (Argus) — The European Commission has proposed a new 90pc cut in car fleet emissions by 2035, replacing the previously agreed 100pc target that would have effectively phased out the sale of internal combustion engine (ICE) vehicles from that date The plan would allow some ICE vehicles to remain on sale beyond 2035, alongside plug-in hybrids, range extenders and mild hybrids, as well as electric and hydrogen cars. The remaining 10pc of emissions would need to be offset through low-carbon steel, e-fuels or biofuels, according to the commission. The proposals need to be adopted by a majority in the European Parliament and among EU states. Automakers could also "bank and borrow" credits between 2030-32 to help meet the existing 2030 target of a 55pc cut from 2021 levels. Under the new proposals, manufacturers using these flexibilities would only need to achieve a 40pc fleet-average reduction, down from a previously planned 50pc. The commission indicated that credits for greenhouse gas (GHG) savings from e-fuels and biofuels can compensate up to 3pc of manufacturers' reference targets for 2035 and low-carbon steel credits can compensate for a further 7pc. Transport commissioner Apostolos Tzitzikostas said the credit system will boost uptake of sustainable fuels. "This is a clear signal than other technologies than battery electric vehicles (BEV) can be put on the market after 2035," said Tzitzikostas. Expanded carbon-neutral criteria would allow sustainable biofuels to help meet the targets that currently require 0g/km from 2035. EU renewable ethanol group ePure said emissions from ethanol were 79pc lower than fossil fuels in 2024, in line with previous years. The European Biodiesel Board reported savings of 77-81pc for biodiesel, using the official fossil fuel comparator of 94g of CO2e/MJ. German MEP Peter Liese criticised the original ICE ban, but said industry problems stem from market shifts, not from Brussels. "The industry must stop shifting the blame for its own mistakes and for market developments, for example in China, onto Brussels," he said, adding that he will push for green steel recognition before 2035. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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EU eases ICE phase-out with new 2035 CO2 car target

16/12/25
News
16/12/25

EU eases ICE phase-out with new 2035 CO2 car target

Brussels, 16 December (Argus) — The European Commission has proposed a new 90pc cut in car fleet emissions by 2035, replacing the previously agreed 100pc target that would have effectively phased out internal combustion engine (ICE) vehicles. The plan would allow some ICE vehicles to remain in use beyond 2035, alongside plug-in hybrids, range extenders and mild hybrids, as well as electric and hydrogen cars. The remaining 10pc of emissions would need to be offset through low-carbon steel, e-fuels or biofuels, according to the commission. The proposals need to be adopted by a majority in the European Parliament and among EU states. Automakers could also "bank and borrow" credits between 2030-32 to help meet the existing 2030 target of a 55pc cut from 2021 levels. Under the new proposals, manufacturers using these flexibilities would only need to achieve a 40pc fleet-average reduction, down from a previously planned 50pc. Expanded carbon-neutral criteria would allow sustainable biofuels to help meet the targets that currently require 0g/km from 2035. EU renewable ethanol group ePure said emissions from ethanol were 79pc lower than fossil fuels in 2024, in line with previous years. The European Biodiesel Board reported savings of 77-81pc for biodiesel, using the official fossil fuel comparator of 94g of CO2e/MJ. German MEP Peter Liese criticised the original ICE ban, but said industry problems stem from market shifts, not from Brussels. "The industry must stop shifting the blame for its own mistakes and for market developments, for example in China, onto Brussels," he said, adding that he will push for green steel recognition before 2035. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Viewpoint: European HVO prices unlikely to ease in 2026

16/12/25
News
16/12/25

Viewpoint: European HVO prices unlikely to ease in 2026

London, 16 December (Argus) — Northwest European hydrotreated vegetable oil (HVO) premiums have firmed on the year in 2025, setting the stage for continued strength as the market braces for higher blending targets in 2026. Premiums strengthen ahead of 2026 targets The Argus HVO Class II fob ARA premium to gasoil averaged $1,075/m³ during January-November, compared with $683/m³ in 2024. The premium firmed to $1,650/m³ on 21 October — a more than three-year high — driven by stronger demand from obligated parties rushing to meet RED targets before the end of the year. Increased consumption against relatively stable production has tightened supplies, and planned maintenance closures at European and Chinese facilities during the fourth quarter may continue to support values into early 2026. Germany's planned legislative changes in 2026 abolishing double-counting of Annex IX feedstocks could significantly boost HVO demand, as higher absolute volumes of biofuel will be needed to meet GHG reduction quotas, which then supports demand for drop-in fuels like HVO. The Netherlands is also planning an end to double counting and a switch to a greenhouse gas savings-based mandate, which could amplify demand in 2026. Trading activity reflects the bullish demand outlook — 888,000t of Class II futures traded on Ice in October, surpassing the previous record of 717,500t in June. Open interest now extends to December 2026, signalling confidence in sustained liquidity. Spot market activity has also picked up in 2025, with Argus Open Markets (AOM) volumes traded for HVO Class II reaching 122,000t in January to November 2025, surpassing the 2024 total of 44,000t. Producers tilt towards HVO over SAF EU sustainable aviation fuel (SAF) targets kicked in at 2pc this year and with this, producers are recalibrating output strategies. Definitive EU anti-dumping duties on Chinese biodiesel and HVO were imposed in February , and EU anti-dumping and anti-subsidy measures already apply to HVO and biodiesel originating from the US and Canada. The China duties do not apply to SAF, but US duties do. HVO and SAF are made from oils and fats via hydrotreatment, but HVO requires fewer processing steps, usually making it the cheaper grade. But HVO Class II has often maintained a premium over SAF throughout 2025 because of different market fundamentals. This encouraged European producers to maximise HVO output over SAF. But tight SAF supply towards year-end — driven by export restrictions from China — pushed SAF premiums above Class II, with the SAF premium over HVO averaging $292/t in November. In October, some additional Chinese producers secured SAF export licences, and with the SAF mandate remaining at 2pc in 2026, European producers are expected to favour HVO production while SAF imports from duty-free China and Singapore fill the gap. The UK Trade Remedies Authority said in late November that it plans to recommend that the government places countervailing duties on US-origin HVO from March. Imports of US HVO into the UK have already declined this year because of the ongoing investigation, and participants expect volumes to fall further. To meet mandates, the UK is expected to lean more heavily on used cooking oil-based biodiesel, while some blenders may also look to secure supply from Nordic producers. By-products soften The Argus bionaphtha fob ARA price averaged $1,541/t in January-November, compared with $1,675/t across 2024. Despite the decline, premiums have recently been supported by stronger HVO and SAF prices, with used cooking oil-based bionaphtha a viable drop-in blending alternative to meet mandates. Looking ahead, participants expect that firm HVO prices will sustain higher bionaphtha premiums in 2026, while voluntary demand, particularly from petrochemical manufacturing, could provide additional support to the market. The biopropane premium to its propane counterpart at the ARA hub fell during 2025, with third quarter levels hitting record lows since Argus began the assessment in October 2023. Argus biopropane fca ARA outright averaged around $1,408/t in January–November, down from $1,597/t in 2024. Although HVO and SAF output have boosted biopropane supply, demand remains constrained without mandated use. Looking ahead, premiums are expected to stay capped unless government incentives accelerate adoption . By Evelina Lungu Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

EU to dilute Ice vehicle phase out: German lawmaker

15/12/25
News
15/12/25

EU to dilute Ice vehicle phase out: German lawmaker

Brussels, 15 December (Argus) — The European Commission is likely this week to dilute its plan to phase out sales of new internal combustion engine (Ice) vehicles by 2035, according to a lawmaker. "The ban on internal combustion engines is history," said Manfred Weber, the chair of parliament's largest centre-right group EPP. He said the commission will present on 16 December an automotive package that "will revise the CO2 standards for cars, reversing the disastrous ban on internal combustion engines". Weber is a member of Germany's CDU/CSU party, as is commission president Ursula von der Leyen. German chancellor Friedrich Merz has called on the EU to allow the sale of vehicles with highly efficient combustion engines, plug-in hybrids and range-extender EVs beyond 2035. This had faced pushback, with more than 150 European e-mobility firms requesting the commission "stand firm" on its 2035 target. An EU official said the target is now likely to be for a 90pc GHG reduction from 2035 for new vehicles. "As it stands the targets for 2030, but also 2035, are not realistic," said Sigrid de Vries, director general of the European Automobile Manufacturers' Association (ACEA). "Even with a 90pc target [for reducing GHG by 2035], make no mistake, that will be very, very challenging." The European motor industry has already flagged the possibility of huge fines for manufacturers should they fail to meet existing emissions targets, which are for a 15pc reduction by 2029 compared with a 2021 baseline, and a 55pc reduction from the same baseline in 2030-34. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Viewpoint: West Africa refineries key to hub status

15/12/25
News
15/12/25

Viewpoint: West Africa refineries key to hub status

London, 15 December (Argus) — West Africa is developing into a regional refining and trading hub, backed by state aims to achieve greater refined product self-sufficiency and export capacity. The extent of further change in 2026 will be defined by the fortunes of existing and fledgling refining projects, including Nigeria's 650,000 b/d Dangote and a clutch of smaller plants. The independently-owned Dangote refinery continues to upend regional and global refined product markets, reducing west Africa's reliance on imports. Since gasoline production began at the refinery in September 2024 , Nigeria — the region's largest gasoline importer — has seen net gasoline imports steadily fall to a historic low of 40,000 b/d in September this year, from 332,000 b/d just a year earlier, Kpler data show. Meanwhile, Nigeria's net middle distillate exports hit a record 145,000 b/d in July, up from 82,000 b/d on the year, and the country has broadly been a net exporter of these products since May 2024. As a result, Nigeria and west Africa as a whole are pulling on considerably less gasoline and middle distillates such as gasoil and jet fuel. Year-to-date, the region — spanning Mauritania to Angola — has seen gasoline imports drop by a quarter on the year to 337,000 b/d, while jet imports have collapsed to 4,000 b/d, both the lowest since at least 2016 when Kpler records began. West African gasoil imports have fallen to a five-year low of 162,000 b/d. Dangote has inarguably transformed regional oil product market dynamics, having proven robust through multiple bouts of maintenance works, and there is room for it to capture more of the domestic gasoline market in the year ahead. The same cannot be said for Nigerian state-owned NNPC's refining assets. The company restarted a 60,000 b/d section of the 210,000 b/d Port Harcourt refinery late in 2024 only to shut it again in May this year, while the 125,000 b/d Warri plant restarted in December 2024 before going offline the following month. This underscores the challenges of modernising or rehabilitating long-mothballed facilities along the west African coast. Refiners in other west African countries are expanding their offerings to regional consumers, further eroding market share previously claimed by European traders. Angola's 30,000 b/d Cabinda refinery is up and running , producing mainly gasoil and jet fuel for the domestic market from its first phase. This is likely to curb Angolan middle distillate import demand, with the refinery — a 90:10 joint venture between UK-based Gemcorp and state-owned Sonangol — meeting 10pc of domestic demand. Cabinda's second phase will add gasoline production, but not until around 2028. Angola imported 20,000 b/d of gasoline in January-August, according to Kpler, around 40,000 b/d of diesel and gasoil, and negligible amounts of jet fuel. In Ghana, the 45,000 b/d Tema Oil Refinery (TOR) continues works to restore nameplate capacity. The privately-owned 120,000 b/d Sentuo Oil Refinery and the country's smaller Platon and Akwaaba modular refineries operate sporadically. TOR's return may be a surprise for 2026, with the operator reporting in October that turnaround activities were taking place "aimed at preparing the refinery for a safe and efficient restart". The refinery's prospects look stronger than those of Ghana's Petroleum Hub Development Corporation (PDHC), which appears to have postponed construction of the first of three planned 300,000 b/d refineries since John Mahama returned to power in January for a non-consecutive second term. The PDHC delays highlight the long lead times typical for large-scale refining projects. Dangote itself took nearly a decade to move from its first loan agreement to eventual start-up. Other projects announced this year are unlikely to advance in 2026, making operating or near-complete refineries in Nigeria, Angola and Ghana critical for the region's push towards a bigger role in the downstream market. By George Maher-Bonnett Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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