Argus Group Three RBOB
Argus recently launched a calculated assessment for reformulated gasoline in Group Three. This move comes following recent changes that were made in gasoline specifications for the Denver, Colorado, area in 2024.
Summertime conventional gasoline sales in Denver, Colorado ended on 7 November 2023 when the US Environmental Protection Agency (EPA) mandated reformulated gasoline for the metropolitan area during the summer season. The shift in specifications was first announced by the EPA ruling in November 2022 when it found the region was not meeting federal ozone standards. Reformulated gasoline burns cleaner than its conventional counterpart but is also a more expensive fuel to produce.
For the winter months, Denver gasoline prices will likely change little from years past. The Reid Vapor Pressure (RVP) levels for reformulated gasoline will likely closely mimic those seen in Group Three’s conventional gasoline market for the southern portion of the midcontinent.
But come summer – which is defined as 1 June through 15 September – Denver area retailers will be required to sell 7.4 RVP reformulated gasoline, as opposed to a prior requirement of 7.8 RVP conventional fuel. This is expected to widen Denver's premium to conventional prices in nearby regions.
Denver reformulated gasoline's premium to sub-octane gasoline prices in adjacent states such as Oklahoma and Kansas should be similar to spreads between Gulf coast CBOB and Gulf coast RBOB. Denver's reformulated gasoline supply will come from a combination of shipments from the midcontinent and Gulf coast markets, as well as from Suncor's 103,000 b/d refinery in nearby Commerce City, Colorado.
Group Three RBOB Methodology
Prices for Regular RBOB are published year-round for 10,000 bl on a fob Tulsa, Oklahoma basis.
Prices are calculated by applying the spread between the prompt Argus Regular Texas Destination RBOB and Regular Colonial CBOB from the US Gulf coast markets to the respective prompt Magellan suboctane V grade price. The use of the spread value mitigates the end-of-summer shift in Colonial RVP specifications.
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Author: Paul Dahlgren, Editor, Refined Products Americas – Gasoline Markets
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Ethanol off the table in Brazil-US tariff talks
Ethanol off the table in Brazil-US tariff talks
Sao Paulo, 13 July (Argus) — A lowering of Brazilian tariffs against ethanol is off the table in current US-Brazil trade negotiations, Brazil trade minister Marcio Elias Rosa said ahead of a 15 July deadline for a new set of US Section 301 tariffs against Brazil. Brazil charges a 18pc rate on ethanol imports, regardless of origin. Ethanol market access in Brazil is among concerns that could warrant the return of a 25pc tariff on Brazil goods to be decided by 15 July, the US Trade Representative's office (USTR) has said. The added tariff would bring the total US rate on Brazilian ethanol to 37.5pc, up from the baseline tariff of 2.5pc prior to US president Donald Trump's Liberation Day. US industry groups in last week's hearing urged USTR to go beyond just applying a 25pc tariff, arguing the government should also remove barriers for crediting US ethanol imports under the Renovabio program. But Brazilian president Luiz Inacio Lula da Silva Rosa does not want ethanol to be in the agenda this time around, nor does he want it to be discussed without sugar tariffs being addressed too, Rosa said. "It is unfortunate that some want a parity regime so that US ethanol can enter [Brazil] with ease," he told reporters. "Opening the market to US ethanol would put ethanol production in Brazil's northeast at risk in particular. We need to take a very careful approach to this industry, which has already been struggling with declining prices." Brazil exported around 50 b/d of ethanol to the US in January-May, according to US Department of Agriculture data. The US exported 11,420 b/d of ethanol to Brazil over the same period. The minister added that Brazilian sugar faces additional tariffs of up to almost 100pc in the US, adding that it is impossible to separate the discussions because they are all linked to the same production chain. The US barriers against Brazilian sugar were also mentioned by Brazil regional sugarcane and bioenergy association Unica as an "asymmetry in bilateral trade". Unica — one of the groups present in the USTR hearings last week — also said the current 18pc ethanol tariff is compatible with World Trade Organization rules, applied on a non-discriminatory basis to all countries that do not have a preferential agreement with Mercosur, the trade bloc of Brazil, Argentina, Uruguay and Paraguay. There is no bilateral agreement requiring Brazil to grant preferential tariff treatment to US ethanol, it argued. The decline in US ethanol exports to Brazil is primarily the result of structural market changes, namely the expansion of corn-based ethanol production in the country filling seasonal gaps, rather than tariff policy, Unica added. "Discussing tariffs among the two largest producers in the world doesn't seem like the best scenario," Andrea Verissimo, Brazilian corn ethanol association Unem's director of international affairs and communications, said in the 6 July USTR hearing. By Maria Lígia Barros and Denise Cathey Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
Court challenge hangs over CARB market updates
Court challenge hangs over CARB market updates
Houston, 13 July (Argus) — California regulators want to implement new cap-and-invest rules on 1 September, but a lawsuit by an environmental justice group may complicate the rollout. The group Communities for a Better Environment (CBE) filed a lawsuit on 1 July that alleges that the California Air Resources Board (CARB) violated the California Environmental Quality Act (CEQA) by adopting the carbon market amendments based on an inadequate environmental impact assessment, particularly regarding a proposed industrial decarbonization incentive. The timeline for a legal resolution is uncertain. CBE filed a similar lawsuit in 2024 against the agency's Low Carbon Fuel Standard amendments that is still moving through the courts. Tick tock The wild card in the short term is how fast the courts would decide on CBE's request to stop CARB from implementing its regulations while the case moves forward, said Matthew Dobbins, a partner at law firm Vinson & Elkins and a member of its environment and natural resources team in Houston. "I don't know that the environmental group here would necessarily be able to show imminent and irreparable harm per se to get an injunction," Dobbins said. A pause in CARB's ability to implement the program changes would have ripple effects inside and outside California. Industrial participants covered by the program would get 137mn metric tonnes (t) of free carbon allowances over 2027-30 under the new regulations, but only 106mn t under the current regulations if an injunction is granted. Recipients include refiners, chemical manufacturers, cement producers and hydrogen makers. Additionally, a delay would prevent the introduction of a free allowance allocation benchmark for biofuel production in the state. It also would stall the development of CARB's new manufacturing decarbonization incentive. While the near-term effect on allowance supply would be limited, it could slow efforts to encourage carbon capture and storage projects tied to California's 2045 net-zero goal. The Western Climate Initiative, a joint carbon market between California and Quebec, is aiming for Washington state to join as soon as next year . But Washington needs California to complete its rulemaking, so it can adopt its own changes to ensure compatible programs. "At least in terms of the trial court we can get a sense fairly quickly which way the judge is going to lean," said Daniel Farber, the faculty director at the University of California, Berkeley Center for Law, Energy & the Environment. Splitting hairs The longer the case goes on without an injunction, the more immaterial CBE's arguments may become. "They sort of risk being in a situation where the lawsuit becomes increasingly irrelevant," Farber said, adding that a lengthy legal process could give CARB time to address any deficiencies while moving ahead with the program. This is not the first time California's cap-and-invest program has been drawn into a CEQA case. A San Francisco Superior Court judge in March 2011 directed CARB to halt implementation of the program until the agency addressed CEQA-related deficiencies with its climate change scoping plan. CARB appealed that ruling, which a state court of appeal overturned in 2012. But it is rare that a CEQA case brought before the court has no merit, according to Nico van Aelstyn, a partner in law firm Sheppard's real estate, energy, land-use and environmental practice. CBE could make a "fair argument" that by delivering the final environmental impact assessment (EIA) to board members on 26 May, there was insufficient time for consideration ahead of the vote days later, van Aelstyn said. But that does not mean CBE would ultimately prevail. Courts have historically given CARB deference on technical emissions matters. If a court requires CARB to redo its assessment, it could be at least six months before the agency is in a position to adopt new changes on a "better" final EIA, van Aelstyn said. CARB must first respond to CBE's petition before the judge can rule on a request to block implementation. By Denise Cathey Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
German HVO demand held back by low Rhine water levels
German HVO demand held back by low Rhine water levels
London, 13 July (Argus) — Low water levels on the Rhine have recently weighed on northwest European hydrotreated vegetable oil (HVO) prices by curbing demand from German buyers, but market participants expect the weakness to be temporary as stronger mandate-driven consumption and tighter global supply fundamentals are likely to support prices later this year. The Argus used cooking oil (UCO)-based HVO Class II and palm oil mill effluent (Pome)-based HVO Class IV outright prices have averaged around $2,765/t and $2,990/t during June and July so far, down from around $2,945/t and $3,290/t during April and May. The decline has been driven largely by weaker demand from Germany, one of Europe's largest biofuel consumers. The water level at Kaub — a critical chokepoint on the Rhine — is forecast to fall to 50cm today, the lowest since August 2022. The resulting logistical disruptions have encouraged some German buyers to meet their greenhouse gas (GHG) reduction obligations through buying GHG quota compliance from other companies, rather than buying physical HVO. Companies generate the compliance by placing eligible renewable fuels that deliver greenhouse gas reductions compared with fossil fuels on the market. In Germany, when converted to the same unit as the GHG quota compliance certificates, HVO classes II and IV ended the week at €343.97/t CO2e and €451.90/t CO2e, according to Argus calculations ( see chart ). The 2026 Advanced and Other GHG quota were at €372.50/t CO2e and €480/t CO2e because of strong buying from obligated companies. Comparing in the same unit, called the cost per ticket (CPT), shows whether physical compliance or buying GHG quota is cheaper at any given time. Renewed volatility in gasoil prices, brought on by the collapse of the fragile ceasefire that followed the signing of the US-Iran Memorandum of Understanding, has also weighed on HVO buying interest. Traders said the uncertainty has encouraged many market participants, particularly smaller buyers, to delay purchases and adopt a wait-and-see approach. But market participants expect prices to strengthen once Rhine water levels rise, with HVO-specific drivers also pointing to a tighter supply-demand balance in the months ahead. The case for HVO RED III compliance targets are set at record levels across many European demand centres this year. In Germany alone, Argus Analytics estimates HVO demand at around 2.1mn t in 2026, up from around 800,000t in 2025, after Germany's RED III implementation entered into law in early June. The new legislation abolished the practice of double counting for advanced feedstocks listed in part A of RED's Annex IX, which is expected to significantly boost HVO demand this year. Germany will require higher absolute volumes of renewable fuels to meet greenhouse gas (GHG) reduction quotas, supporting demand for drop-in fuels such as HVO. Increased demand from the Netherlands could also lend support to the market, participants said. Dutch renewable fuel tickets have traded at a discount to physical HVO for most of 2026, partly because ticket generation has increased as a larger volume of renewable transport credits has been created from electric vehicles (EVs) and biomethane than in previous years. In the Netherlands, on an equivalent basis as the tickets, HVO classes II and IV ended at 40.52c/kg CO2e and 51.69c/kg CO2e on 10 July, respectively, compared with 37.62c/kg CO2e and 48.50c/kg CO2e for the equivalent tickets, LRE-B and LRE-G. On the HVO supply side, the finalisation of the new US renewable volume obligation in April has created a domestic requirement that is expected to outpace US HVO production. This has effectively eliminated the exportable surplus that previously flowed to Europe, which made the US one of the region's biggest HVO importers. The US had an exportable surplus into Europe of around 750,000t in 2025, according to Argus Analytics. Europe will have to increasingly rely on HVO supply from Singapore, China, Malaysia and Canada, which could also flow in part to the US. US output has also faced operational challenges. A reported explosion at PBF's facility in May, combined with hydrocracker maintenance at Phillips 66's Rodeo refinery has reduced available supply. A third US facility may undergo a turnaround this summer. In Europe and Asia, expected maintenance at several production facilities this summer — including Ecoceres and Neste — is expected to constrain supply in the near term, lending further support to prices. Expectations of firmer prices are reflected in the Class II forward curve. The HVO Class II Argus -settled Ice contract as a differential to gasoil has remained in contango since 6 July and peaks in October. This structure is partly driven by the backwardation in the gasoil curve, reflecting expectations that tensions between the US and Iran will ease and HVO premiums to gasoil adjust higher as a result. But the outright HVO curve is also slightly in contango, with prices peaking in September. This suggests that HVO-specific fundamentals are likewise pointing to higher outright prices in the near term. By Evelina Lungu HVO fob ARA outright $/t Cost difference: Blending vs ticket purchase (Germany) €/t Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
Hormuz transits sparse after US-Iran clashes: Update
Hormuz transits sparse after US-Iran clashes: Update
Updates with details throughout London, 12 July (Argus) — Ship transits through the strait of Hormuz fell further following fresh clashes between the US and Iranian militaries over the weekend. US and Iranian forces both expanded their attacks for two consecutive days on Saturday and Sunday, hitting defense targets and, in the case of Iran, resuming attacks on ships and oil infrastructure in the Mideast Gulf. US forces launched another round of attacks against Iran at 22:00 GMT on Sunday, according to US Central Command (Centcom), which oversees Middle East-based US forces. Iran's forces earlier on Sunday targeted Kuwaiti border checkpoints and an offshore oil facility, Kuwait's defense ministry said. Iran's Islamic Revolution Guards Corps (IRGC) said early on Sunday that the strait of Hormuz would be closed until further notice, after the US on Saturday carried out another round of strikes on Iranian military targets. IRGC also claimed that its attacks on a Kuwait-based US military base resulted in US casualties. Centcom disputed the claim. Centcom also disputed Tehran's claim of having shut down Hormuz. "Iran does not control the strait," Centcom said in a social media post. "Traffic is flowing." But visible AIS data from MarineTraffic showed no traffic through the strait, although vessels may be transiting with tracking systems switched off. The growing security risk could limit such attempts and threaten the nascent recovery in Gulf crude and product exports. Iran's forces appeared to have attacked Cyprus-flagged containership GFS Galaxy as it transited the strait of Hormuz via the southern route near Oman on Saturday. The vessel was hit nine nautical miles east of the Omani coast, prompting the crew to abandon the ship in a lifeboat. The lifeboat has since been rescued by local authorities, the UK Maritime Trade Operations (UKMTO) said. The vessel appeared to have its AIS tracking switched off at the time. In a separate IRGC statement carried by the Sepah news agency early on Sunday, the force claimed its aerospace arm had struck logistics support centres and refuelling platforms linked to US aircraft carriers at Duqm port in Oman. Duqm is a significant distance from the strait of Hormuz and was hit in the early days of the war, but it has been less severely affected since. Oman's state news agency also reported drone strikes across Musandam governorate, Oman's northernmost governorate. Oman condemned the attacks, the agency added. By John Ollett, Rithika Krishna and Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.