Market evolution: Low sulphur fuel oil (CN 27101966) — 2015–2025

Introduction

This report analyzes the EU's external trade in low sulphur fuel oil (CN 27101966) from 2015 to 2025. The data reveals a fundamental shift in the EU's trade position for this product, characterized by a dramatic decline in exports, a more moderate rise in imports, and the significant impact of global energy price shocks. These dynamics have led to a substantial erosion of the EU's historical trade surplus and a restructuring of its import dependencies, highlighting increased vulnerability to global market volatility.

1. The EU's Erosion from Net Exporter to Near-Balance

The most significant trend over the period is the collapse of the EU's trade surplus, driven by a steep fall in export volumes and a steady increase in import values. This shift suggests a structural change in the EU's refining capacity or domestic demand for this specific grade of fuel oil.

1.1. A Dramatic Contraction in Export Performance

EU exports of CN 27101966 have fallen sharply across all metrics between the first and last available data points (2020 to 2025). The value of exports decreased by 24.1% to €1.76 billion, while the quantity exported plummeted by 49.6% to under 4 million tonnes. This indicates that the EU is both selling less fuel oil abroad and facing unfavorable price trends for its remaining exports, despite rising nominal prices. The peak export value of €5.87 billion was reached in an intermediate year, underscoring the subsequent volatility and decline.

1.2. Simultaneous Growth in Import Values

In contrast to exports, the value of EU imports grew substantially by 91.8%, reaching €967.8 million in 2025. While import quantity also increased by 17.1%, the much faster growth in value was primarily driven by surging unit prices, which rose by 63.8% to €466 per tonne. This price-driven increase in import expenditure, coupled with falling export quantities, squeezed the trade balance.

1.3. The Near-Halving of the Trade Surplus

The combined effect of declining exports and price-inflated imports has severely diminished the EU's trade surplus in this product. The surplus fell by 56.2%, from €1.82 billion in 2020 to €797 million in 2025. The surplus reached its zenith at €4.45 billion in an intermediate year, indicating that the shift towards a more balanced or potentially deficit position is a relatively recent and severe phenomenon. The full trade data can be explored here.

2. Price Shocks, Volatility, and Supply Chain Disruption

The period was marked by extreme price volatility, particularly around 2022, which triggered identifiable trade shocks. This volatility underscores the product's integration into global energy markets and its sensitivity to geopolitical events.

2.1. Synchronized Price Inflation for Both Imports and Export

Both import and export unit prices followed a similar trajectory, with minimums recorded at the start of the period (around €284-295/t) and maxima well over €680/t. This synchronized movement points to exogenous global factors—such as the 2022 energy crisis linked to the Russia-Ukraine conflict—overpowering regional EU dynamics and determining price levels for this commodity. The price data can be visualized here.

2.2. Detection of Significant Supply and Price Shocks in 2022

The analysis detected several high-abnormality events centered on the year 2022. For instance, export prices to Ceuta surged by 79.4%, while import prices from the Russian Federation spiked by 109.5%. These shocks, which coincide with the onset of the energy crisis and subsequent sanctions, demonstrate the immediate disruption to established trade patterns and pricing structures. Details on these shocks are available here.

2.3. High Volatility in Traditional and Emerging Trade Links

Volatility, measured by the coefficient of variation, was pronounced across key partners. Imports from the Russian Federation (CV: 1.11) and Kazakhstan (CV: 1.34) were highly volatile. For exports, links to Singapore (CV: 0.62) and the United Arab Emirates (CV: 0.77) showed significant instability. This widespread volatility complicates trade planning and suggests a period of instability for commercial relationships in this market. Explore the volatility metrics here.

3. Shifting Geographic Dependencies and Increased Concentration

The geographic landscape of EU trade has been redrawn, with traditional partners losing ground to new suppliers. Concurrently, the market has become more concentrated on both the import and export sides.

3.1. Collapse of Russian Imports and Diversification to North Africa

Imports from the Russian Federation, a major historical source, collapsed by 99.5% to just over €500,000 in 2025, reflecting the impact of EU sanctions. In contrast, imports from Algeria grew exponentially by over 3,000% to €369.5 million, and those from Tunisia emerged to €80 million. Norway and the UK also solidified their positions, with Norway's imports growing by 805%. This indicates a rapid, crisis-driven diversification away from Russia towards North Africa and stable European partners. The full partner data is accessible here.

3.2. Geographic Shifts in EU Export Flows

Export patterns also transformed. The category "Stores and provisions within the framework of extra-Union trade," the largest export destination in 2020, saw an 84.9% drop in value. Gibraltar remained a major hub, with exports rising by 45.2%. Meanwhile, exports to the United Kingdom grew by 96.7%, making it the third-largest destination. This suggests a reorientation of export flows from unspecified extra-EU destinations (likely maritime bunkering) towards more stable, identified partners like the UK and Gibraltar.

3.3. Rising Market Concentration

The Herfindahl-Hirschman Index (HHI) for both imports and exports increased, signifying growing market concentration. The HHI for import value rose from 2,056 to 2,369, and for export value from 959 to 1,526. This indicates that trade is flowing through fewer, larger channels. On the import side, this concentration reflects the heavy reliance on a few key suppliers (like Algeria and Norway) to replace lost Russian volumes. On the export side, it shows the growing dominance of hubs like Gibraltar. The concentration metrics can be examined here.

Conclusion

The EU's trade in low sulphur fuel oil underwent a profound transformation between 2015 and 2025. The bloc transitioned from a position of strong net exporter towards one of near trade balance, driven by a severe contraction in export volumes. This shift was acutely amplified by the extreme price shocks of 2022, which exposed the market's vulnerability to global geopolitical disruption. Geographically, the EU successfully but rapidly diversified its import supply away from Russia, becoming more reliant on North African and European partners, though this has led to increased market concentration. Overall, the period is characterized by a loss of export capacity, heightened price-driven financial exposure, and a restructuring of supply chains in response to a major geopolitical shock.