Market evolution: Diesel fuel (CN 27102011) — 2015–2025

Introduction

This report examines the EU's external trade in ultra-low-sulphur gas oil containing biodiesel (CN 27102011) over the period 2015–2025. The product falls under Chapter 27 of the Combined Nomenclature and covers gas oils with at least 70% petroleum content, a sulphur content not exceeding 0.001% by weight, and an admixture of biodiesel — essentially the blend specifications mandated by the EU's Renewable Energy Directive for road diesel fuel. Over the decade studied, the EU's trade in this product has undergone three major transformations: a structural widening of the trade deficit driven by surging imports, a marked geographic consolidation around a small number of suppliers — above all the United Kingdom — and a dramatic price shock in 2022 whose effects have only partially unwound. The analysis that follows draws on Eurostat trade data as compiled on the Trade Dashboard.

1. From Surplus to Deficit: The EU's Growing External Dependence on Diesel Blends

Imports surged while exports contracted over the decade

The most striking feature of EU trade in CN 27102011 is the diverging trajectories of imports and exports. Over the full period, extra-EU imports rose from 460,820 tonnes (€214.9 million) in 2015 to 826,621 tonnes (€554.9 million) in 2025 — a volume increase of 79.4% and a value increase of 158.2%. During the same period, extra-EU exports fell from 326,619 tonnes (€160.1 million) to 225,191 tonnes (€146.4 million), representing a volume decline of 31.1%.

Source: General Overview

The trade deficit widened almost eightfold in nominal terms

The EU's trade balance in this product deteriorated from −€54.9 million in 2015 to −€408.5 million in 2025, a worsening of 644.6%. At its nadir, the deficit reached −€647.4 million, underscoring the structural nature of the shift. This trajectory is consistent with the broader trend of declining EU refinery capacity and rising dependence on imported refined petroleum products, particularly following the closure or conversion of several European refineries during the 2010s and the post-COVID recovery in diesel demand.

Unit values rose substantially, amplifying the value-side deterioration

Both import and export unit values increased significantly over the period. Import prices rose from €466/t to €671/t (+43.9%), while export prices climbed from €490/t to €650/t (+32.6%). The faster growth of import unit values relative to export unit values further widened the deficit in value terms. Notably, import unit values peaked at €1,007/t and export unit values at €1,132/t, both in the same year — consistent with the global energy price spike of 2022.

Source: General Overview

2. Geographic Consolidation: The United Kingdom's Dominance and the Retreat of Diversified Suppliers

The UK became the overwhelmingly dominant trade partner on both sides

The United Kingdom is by far the EU's largest extra-EU partner for CN 27102011, both as a supplier and as a destination. On the import side, flows from the UK rose from €131.9 million in 2015 to €440.0 million in 2025 — an increase of 233.6% — making the UK responsible for a very large share of total extra-EU imports. On the export side, EU shipments to the UK grew from €40.6 million to €71.0 million (+75.0%), though exports peaked at €173.4 million in an intermediate year. The post-Brexit trade regime, including the application of rules of origin under the EU–UK Trade and Cooperation Agreement, has not impeded this bilateral flow; if anything, the UK's importance has increased.

Traditional Middle Eastern and Nordic suppliers lost ground

Several former significant import sources declined sharply over the period:

Source: Top partners by value

Israel's collapse from €52.8 million to €2.0 million (−96.3%) is especially notable; it was the second-largest supplier in 2015 and became marginal by 2025. Norway, historically a key North Sea diesel supplier, also saw its role diminish substantially. Russia, despite being a major global diesel exporter, saw a decline of 52.0% even before the EU sanctions regime of 2023 began to take full effect. India (+203.3%) and Saudi Arabia (+30.7%) bucked the trend, but neither approached the UK's scale.

Concentration rose sharply on both the import and export sides

The Herfindahl–Hirschman Index (HHI) for imports by value rose from 4,566 to 6,420 (+40.6%), while the export HHI increased from 2,258 to 3,116 (+38.0%). Both figures indicate a moderate-to-highly concentrated market. The rising trend implies that the EU's sourcing of this specific diesel blend has become less diversified over time — a development that increases vulnerability to supply disruptions from any single partner.

Source: Concentration

On the export side, traditional destinations such as Gibraltar (−81.6%), Andorra (−84.8%), and Moldova (−77.5%) all contracted sharply, while the UK absorbed a growing share. Small EU Member States with specialised refinery sectors — Greece, Sweden, Slovakia, Slovenia, and Austria — show the highest revealed comparative advantage (RSCA) in this product, consistent with their role as regional diesel blenders. Conversely, Finland, Luxembourg, Denmark, Portugal, and France show negative specialisation indices, indicating they are net importers of this product within the broader EU context.

3. The 2022 Energy Price Shock and Its Aftermath

2022 saw the largest price shocks on record for this trade flow

The volatility analysis identifies three major price shock events, all centred on 2022 — the year of Russia's full-scale invasion of Ukraine and the ensuing global energy crisis:

Source: Supply shocks

The UK import price shock — a 141% year-on-year jump with an abnormality score of 7.8 — affected 100% of the UK-to-EU import value, reflecting the fact that the UK is such a dominant supplier. The Andorra and UK export price shocks, while smaller in absolute terms, were equally extreme relative to historical norms. These price spikes correspond to the global surge in refined product prices that followed the disruption of Russian energy exports and the EU's progressive embargo on Russian petroleum products.

Volatility profiles differ markedly across partners

The coefficient of variation (CV) of bilateral trade values reveals substantial heterogeneity in partner stability:

Source: Volatility

The United Kingdom is the least volatile import partner (CV = 0.22), reinforcing its role as a stable, structural supplier. By contrast, Norway (CV = 2.07), Kuwait (CV = 1.73), and Canada (CV = 1.73) exhibit highly intermittent trade patterns, suggesting opportunistic or spot-market-driven flows. On the export side, the UK is again relatively stable (CV = 0.60), while Morocco (CV = 2.23) and Ukraine (CV = 1.39) show high volatility.

Prices have not fully reverted to pre-shock levels

While the 2022 spike was extreme, the 2025 unit values (€671/t for imports, €650/t for exports) remain well above the 2015 baseline (€466/t and €490/t respectively). This suggests that even though the acute crisis has passed, structural factors — including higher carbon costs under the EU Emissions Trading System, tighter sulphur specifications, and increased blending mandates — have established a higher price floor for ultra-low-sulphur biodiesel blends compared to the pre-2022 era.

Conclusion

EU trade in CN 27102011 has undergone a pronounced structural transformation between 2015 and 2025. The bloc has shifted from a roughly balanced trade position to a substantial net importer, with the deficit widening from €55 million to €409 million. This trend reflects both the contraction of EU refining capacity for ultra-low-sulphur biodiesel blends and the growing domestic demand driven by blending mandates. Geographically, the market has consolidated around the United Kingdom, which dominates both import and export flows, while traditional Middle Eastern and Nordic suppliers have receded. Rising HHI indices confirm that this concentration is not merely a UK-specific story but a structural feature of the market. Finally, the 2022 energy crisis left a lasting imprint: price shocks exceeding 100% year-on-year marked the acute phase, and unit values in 2025 remain elevated relative to the pre-crisis baseline. For policymakers, the combination of growing import dependence, rising supplier concentration, and persistent price elevation points to continued vulnerability in the EU's diesel supply chain — a risk that may intensify as the energy transition progresses and refinery closures accelerate.