December 16, 2019

The Middle East Stays on Course in Sulfur Reduction Plans

Stratas Advisors

This excerpt is from a report that is available to subscribers of Stratas Advisors’ Global Fuel Specifications service.

Already a subscriber? Read the full report.

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 2196/2011 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:

  • Improvement in fuel quality;
  • Improvement in vehicle emission standards;
  • Introduction of public transportation;
  • Reduction in vehicle ownership growth; and
  • Use of alternative fuels.

The full report updates a previous report (see Insights, March 29, 2017), where Stratas Advisors noted that GCC countries agreed to adopt 10 ppm sulfur fuels in their domestic markets by 2020. However, because of the downturn of oil prices and political instability, several refinery upgrading projects have been put on hold, resulting in delays of implementing stricter fuel quality likely until 2025 at the earliest.

This report 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, Syria and Yemen.

Changes Since Last Report

Since the last report, Stratas Advisors found updated fuel specs for Jordan, Oman, Saudi Arabia and U.A.E., market gasoline and diesel specs for Iraq and refinery specs for Jordan. 

In May 2017, the U.A.E. implemented a new gasoline specification which reduced the sulfur limit from 100 ppm to 50 ppm. The new specs are available for the three grades used in the U.A.E. including RON 91, RON 95 and RON 98.

Oman also introduced new gasoline specifications in May 2019 that reduced the sulfur limit from 1,000 ppm to 50 ppm, which were eventually implemented in July 2019. The new specs are available for the two grades used in the Sultanate of Oman i.e. RON 91 and RON 95. Also starting December 2019, the sulfur limit will further reduce to 10 ppm for both grades. As a result, Oman will be the first GCC member country to officially implement 10 ppm for gasoline. 

In addition, in 2018, Saudi Arabia published a new standard SASO 844/2018 containing specs for low sulfur diesel with a maximum sulfur limit of 10 ppm, which will replace and supersede SASO 844/1994 after the expected completion of the Clean Fuels Project in 2024. 

In addition, in Iran, 10 ppm sulfur gasoline has been made available at some of the pumps in eight major cities, alongside 50 ppm.

 
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