Global Diesel Scramble: Biofuel Flows Rerouted as Policy Walls Harden
Europe remains at the center of fuel market tension as diesel inventories trend dangerously low across ARA hubs. A rare VLCC shipment of 2 million barrels of ULSD from Saudi Arabia to France—typically a crude route—highlights the severity of the supply crunch. Red Sea freight insecurity and curtailed Russian flows are forcing traders to redeploy large coated tankers for clean products. Meanwhile, biodiesel premiums remain firm, with FAME 0 trading at $630/t and RME at $665–668/t. However, physical price momentum is softening. HVO Class II has surged to $2,219.78/t fob ARA, supported by a strong bid stack and escalating gasoil. Yet despite months of trade discussions and the current US-EU deal, renewable diesel exports from the U.S. remain effectively blocked. Only the UK currently offers a viable destination, as the combination of RIN retirement obligations and EU countervailing duties against U.S. biodiesel and RD continues to prevent transatlantic flows into the European continent.
Want to read more?
Subscribe to globalbiodiesel.com to keep reading this exclusive post.
