Subsidy Helps Petrobas Raise Runs

Aggressive fuel price increases caused Brazil’s truckers to strike in May. The resulting government subsidy to smooth out diesel prices for consumers will help Petrobras raise runs and avoid sacrificing market share to importers. At the same time, demand is expected to grow by 20,000 b/d to 960,000 b/d. ESAI Energy expects Brazil’s diesel import requirement to remain flat in the second half of 2018 at 210,000 b/d.

California to Boost Renewable Diesel Use

Later this year, California regulators will vote whether to extend the state’s Low Carbon Fuel Standard(LCFS) from its current expiration in 2020 to 2030. If it passes, renewable diesel would be the biggest winner among biofuels. A shortage of renewable diesel in California would create a strong incentive for producers to build new capacity in the next decade, particularly in feedstock-rich Asia.