Demand for key French E85 gasoline grade fell year on year in July, and for the first time in 7 years, outside of falls recorded during the Covid-19 pandemic.
Sales of the E85 gasoline grade were 59,000t in July, down by 6.5pc on the year and from 64,000t in June, according to latest data from domestic road fuel federation SNPAA. Aside from distortions from mandated movement restrictions during the pandemic, this was the first year on year fall in demand since July 2016.
The reasons for the fall are not yet clear. A sharp rise in demand for E85 since 2021 has boosted ethanol consumption in France, driven by new car ranges launched that summer. But growth appears to have stalled, having been flat on the year in June, before falling in July. This meant E85 took a 5.9pc share of French gasoline sales in July, the lowest level since February 2022 and well below a peak of 7.6pc in November of the same year (see chart).
Sales of flex fuel cars which run on E85 have continued, although far more hybrid vehicles than single fuel cars are being sold. Availability has also continued to rise as more service stations stock the fuel. The SNPAA has yet to reply to a request for comments.
Even as E85 demand fell overall ethanol demand — including for use in the oxygenate ETBE — remained strong, at the third highest level on record. Consumption was 129,000t in July, compared with 132,000t in June, according to the SNPAA and Argus calculations. This was up by 1.7pc on July last year.
Demand in July was boosted by a second consecutive month of record sales of E10 — gasoline containing 10pc ethanol — which hit 545,000t, up by 7.6pc year on year and from 540,000t in June. E10 took a 57.4pc share of all French gasoline sales, lower than the record 59.3pc set in February. Demand for E10 increases in the summer but generally its share of French overall consumption falls slightly.
Sales of SP95 gasoline — which can contain up to 5pc ethanol — were 152,000t in July, down by 4.7pc on the year. Demand has been steadily declining for more than a decade as E10 has taken a larger tranche of overall sales. Consumption of the premium grade SP98 — which contains 1pc ethanol but up to 15pc ETBE — rose to 196,000t, up by 10.6pc on July last year and the highest level since August 2021.
Argus estimates that ethanol's calorific share of French gasoline demand was 8.7pc in July, lower than 8.9pc in June and the record of 9.4pc set in February. Averaged over the first seven months of this year the share was just under 9.1pc tranche, short of the mandate of 9.3pc for 2023.
