The GCC published GSO 2196:2021 replacing GSO 2196:2011 setting a gasoline sulfur limit of 10 ppm, in addition to spec revisions for the six GCC members.

Analysis

Senior Analyst, Africa & Middle-East

Anas Abdoun

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In the Middle East, fuel quality improvements are primarily driven by the refining industry and their export market requirements, and are often not regulated even in a number of the Gulf Cooperation Council (GCC) member countries including Bahrain, Kuwait, Qatar and Saudi Arabia. Most countries in the region aim to follow European fuel specifications and vehicle emission standards. However, refiners mostly start with sulfur reduction before further controlling other parameters. Nonetheless, the GCC Standardization Organization (GSO) aims to eventually harmonize fuel quality and vehicle emission standards in the GCC member countries by setting several standards including GSO 2196/2021 for gasoline and GSO 477/2011 for diesel fuel.
Despite the region having large oil reserves, increasing international pressure to reduce air pollution has become a major driver to pursue numerous options, including:
<div style="background-color: #ffffff;">
<ul>
<li>Improvement in fuel quality;</li>
<li>Improvement in vehicle emission standards;</li>
<li>Introduction of public transportation;</li>
<li>Reduction in vehicle ownership growth; and</li>
<li>Use of alternative fuels.</li>
</ul>
</div>
Also, as the Middle East is becoming a major fuel producer for export markets, global sulfur reductions are pushing refineries in the region to be compliant to gain more export market share compared to older refineries that do not have the financial power of the GCC refineries.
This report updates a previous report, where Stratas Advisors noted that Saudi Arabia and Iran planned to implement new fuel specs for diesel and gasoline in 2022. However, after a delay to 2022 and to January 2023, Saudi Arabia did not implement the 10 ppm sulfur limit. The latest communication with Saudi Aramco is that they are aiming to maximize opportunities from reconfiguration of the fuel market due to ongoing sanctions against Russia. On the other hand, Iran officially implemented 50 ppm for diesel and gasoline but has yet to publish new fuel specifications (see map below).&nbsp;
The GCC published in 2021 the GSO 2196:2021 Gulf Guide of Standard Specification for Unleaded Gasoline, replacing GSO 2196:2011. The new specifications set a sulfur limit of 10 ppm for RON 90/91 and RON 95/97 grades, in addition to revision of gasoline specifications for the six GCC members. Comparing GSO 2196:2021 with GSO 2196:2011, sulfur limits remain the same for Bahrain, Kuwait, Oman and Saudi Arabia, in addition to a sulfur limit continuing to be absent for Qatar. Only the sulfur limit for U.A.E. was reduced from 100 ppm to 50 ppm max, though U.A.E. published in 2021 national gasoline standard UAE. S 5018:2021 which currently sets a sulfur limit of 10 ppm. The new specifications replaced UAE.S 5018: 2017 reducing the sulfur limit from 50 ppm to 10 ppm and apply to the three grades currently available on the market, namely RON 91, 95 and 98.&nbsp;
Current Gasoline Sulfur Limits in the Middle East
<img alt="Map" src="https://cdn.aglty.io/stratas-advisors/upload/Maximum Gasoline Sulfur Limits in Middle East.png" style="width: 720px; height: 591px;" />
Source: Stratas Advisors, March 2023
The full report&nbsp;covers 12 countries in the Middle East including the six GCC members of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the U.A.E., as well as Iran, Iraq, Jordan, Lebanon,&nbsp;Syria&nbsp;and Yemen.

The Middle East Continues to Anticipate Implementation of Low-Sulfur Fuels through 2025

<ul role="list">
<li data-leveltext="" data-font="Symbol" data-list-defn-props="{'335552541':1,'335559684':-2,'335559685':720,'335559991':360,'469769226':'Symbol','469769242':[8226],'469777803':'left','469777804':'','469777815':'hybridMultilevel'}" aria-setsize="-1" data-aria-posinset="1" data-aria-level="1" role="listitem">The Gulf Cooperation Council (GCC) published new gasoline standard GSO 2196:2021 containing 10 ppm sulfur specs in January 2021;</li>
<li paraid="334586639" paraeid="{577bf6fa-6614-47f9-b2f3-8a6685609814}{234}">Saudi Arabia and U.A.E. followed with new SASO and UAE standards containing 10 ppm sulfur specs taking effect since January and September 2021 respectively;</li>
<li data-leveltext="" data-font="Symbol" data-list-defn-props="{'335552541':1,'335559684':-2,'335559685':720,'335559991':360,'469769226':'Symbol','469769242':[8226],'469777803':'left','469777804':'','469777815':'hybridMultilevel'}" aria-setsize="-1" data-aria-posinset="2" data-aria-level="1" role="listitem">Saudi Arabia has yet to implement 10 ppm nationwide despite completion of refinery upgrades in January 2021 under the Clean Fuel Project;</li>
<li data-leveltext="" data-font="Symbol" data-list-defn-props="{'335552541':1,'335559684':-2,'335559685':720,'335559991':360,'469769226':'Symbol','469769242':[8226],'469777803':'left','469777804':'','469777815':'hybridMultilevel'}" aria-setsize="-1" data-aria-posinset="3" data-aria-level="1" role="listitem">Other GCC countries are expected to shortly follow Saudi Arabia and harmonize the implementation of 10 ppm sulfur fuels throughout 2025, if not already done so, given existing refinery capabilities to produce the fuels;</li>
<li data-leveltext="" data-font="Symbol" data-list-defn-props="{'335552541':1,'335559684':-2,'335559685':720,'335559991':360,'469769226':'Symbol','469769242':[8226],'469777803':'left','469777804':'','469777815':'hybridMultilevel'}" aria-setsize="-1" data-aria-posinset="4" data-aria-level="1" role="listitem">Iran officially implemented 50 ppm sulfur limit for gasoline and diesel in 2022;</li>
<li data-leveltext="" data-font="Symbol" data-list-defn-props="{'335552541':1,'335559684':-2,'335559685':720,'335559991':360,'469769226':'Symbol','469769242':[8226],'469777803':'left','469777804':'','469777815':'hybridMultilevel'}" aria-setsize="-1" data-aria-posinset="4" data-aria-level="1" role="listitem">GSO standards are currently in place&nbsp;requiring&nbsp;Euro&nbsp;4 and&nbsp;Euro&nbsp;5&nbsp;for&nbsp;Model Year (MY) 2023 and 2024&nbsp;gasoline and diesel vehicles, depending on country; and</li>
<li data-leveltext="" data-font="Symbol" data-list-defn-props="{'335552541':1,'335559684':-2,'335559685':720,'335559991':360,'469769226':'Symbol','469769242':[8226],'469777803':'left','469777804':'','469777815':'hybridMultilevel'}" aria-setsize="-1" data-aria-posinset="4" data-aria-level="1" role="listitem">Saudi Arabia is the only country in the region to set mandatory fuel efficiency standards for light-duty vehicles.</li>
</ul>