February 24, 2016

World Continues Its Trend to Lower Sulfur Content in Diesel

Stratas Advisors

This is a segment of a report from Stratas Advisors’ Global Fuels Specifications service. The full report, which is available to members, has the full rankings and other key information about sulfur content in diesel.

Stratas Advisors’ annual Top 100 rankings report affirms a continued worldwide movement toward lower sulfur content in diesel. The report cites a number of countries that have positioned themselves through policy initiatives to make advances in this area in the near future. However, it is worthwhile to note that aspects other than sulfur reduction ― among them cetane, lubricity, polyaromatics, density and cold flow ― are important in determining diesel quality.

EU countries, which are required to implement 100% market penetration of sulfur-free (less than 10 ppm) fuels since January 2009, continue to dominate the Top 40. Sweden, which led the way with full market penetration in 1990, continues to reign at No. 1.

Even though Beijing is not officially ranked, the Chinese city has required 10 ppm sulfur fuels since May 2012. The rest of China is currently required to meet a maximum sulfur limit of 50 ppm.

Sixteen countries moved up or were newly added to the 2016 rankings, compared to 23 countries in the 2015 ranking. Led by Belarus and Russia, which took the 49th and 50th places, respectively, the 16 countries include:

Kyrgyzstan, Macau, Paraguay, Philippines, Russia, Sudan, Ukraine and Vietnam. These countries moved up because of changes in sulfur limits over 2015-2016.

Bahrain, Belarus, Fiji, Kazakhstan, Lesotho, Malawi, Mozambique and Papua New Guinea. These countries did not see changes in their sulfur limits during 2015-2016 but moved up as a result of Azerbaijan, Qatar, Turkmenistan and U.A.E. moving down the rankings.

To establish the rankings, four primary criteria were used in the following order of importance:

• Maximum allowable limits in national standards and legislation.

• Year of implementation for sulfur limits as required by legislation, and year of voluntary implementation ─ if any.

• Limits in local or regional standards (such as specifications for cities or states).

• Market levels are also used wherever available to more accurately rank countries sharing the same legislated limit.

In the 2016 rankings, Russia & CIS saw the most number of changes for diesel sulfur, namely Kyrgyzstan, Russia and Ukraine. As of January 2016, Kyrgyzstan moved to 500 ppm and entered the top 100 at 88th place, moving up 23 spots. At the same time, Russia moved from 50 ppm to 10 ppm and took the 50th spot, moving up six places. Ukraine ranked at 59th after moving up 14 places due to a reduction of its sulfur limit from 150 ppm to 50 ppm max. Even though Georgia also reduced its diesel sulfur limit from 200 ppm to 150 ppm from Jan. 1, 2016, it dropped from 71st to 73rd place in the 2016 because of other countries moving to 50 ppm sulfur or below.

There were no changes to the diesel sulfur limits of countries in Africa, Europe, the Middle East and North America. For Sudan it is worthwhile to note that its change in the 2016 rankings did not result from the adoption of more stringent fuel quality legislation or standards, but from Stratas Advisors receiving updated information on its diesel sulfur limit which was already reduced from 10,000 ppm to 500 ppm in 2010. This resulted in Sudan jumping the farthest by 56 places to enter the Top 100 at 95th place.

The top 4 counties with the lowest sulfur content in diesel for 2015-16 are:

1. Sweden; 2. Germany; 3. Japan; 4. Finland.

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