Market evolution: Process fuel oil (CN 27101951) — 2015–2025

Introduction

This report examines the evolution of EU extra-EU trade in fuel oils destined for further processing (CN 27101951) over the period 2015–2025. The product covers petroleum-based fuel oils that are not consumed directly as end-use fuels but instead undergo specific refining or petrochemical processes as defined in Additional Note 5 to Chapter 27, excluding biodiesel-containing blends. Over the decade under review, EU trade in this product has been reshaped by three major dynamics: a secular contraction of traded volumes, a dramatic reconfiguration of supplier geography following the loss of Russian supply, and significant shifts in price levels and volatility. The overall trade dashboard provides the full context for the figures discussed below.

1. A Decade of Contraction: The Secular Decline of EU Process Fuel Oil Trade

Import volumes and values fell by roughly three-quarters over the period

EU imports of CN 27101951 declined from €6.15 billion and 21.4 million tonnes in 2015 to €2.27 billion and 5.0 million tonnes in 2025 — a drop of 63.0% in value and 76.6% in volume. This was not a single shock but a prolonged contraction that accelerated in the final years of the period. The trade deficit in this product accordingly narrowed from €5.97 billion to €2.27 billion (a 62.0% improvement), reflecting both reduced import dependence and the near-disappearance of exports.

EU exports of process fuel oil essentially vanished

Exports fell from €180.1 million (570,516 tonnes) in 2015 to just €5.9 million (22,689 tonnes) in 2025 — declines of 96.7% and 96.0% respectively. This collapse was broad-based: the United States, once the largest single export destination at €106 million in 2015, recorded virtually zero shipments by 2025 (€76). Norway fell from €41.0 million to €17. The United Kingdom declined from €23.7 million to €383,000. Gibraltar, once a significant bunkering/trading hub at €49.9 million, dropped to €5.5 million. The partner-level export data shows that by 2025, only Ceuta (+€20.9 million, from a negligible base of €3,251) and Egypt (+€5.0 million) registered meaningful export growth — but these remain small in absolute terms.

Unit prices tell a diverging story for imports versus exports

Import prices rose 56.3% over the period, from €287/t in 2015 to €449/t in 2025, with a trough of €235/t and a peak of €612/t (likely in 2022, the year of the global energy price spike). Export prices, by contrast, ended 18.0% below their starting level at €259/t — their period minimum — after reaching a remarkable peak of €2,275/t (likely reflecting small, high-value niche shipments). These divergent trends suggest that the EU's residual export activity shifted toward lower-value flows while import costs structurally increased.

Sources: General overview

2. Russia's Collapse and the Geopolitical Reconfiguration of Supply

Russia dominated EU imports at the start of the period

In 2015, the Russian Federation supplied €4.00 billion of the EU's €6.15 billion in process fuel oil imports — a 65% market share by value. At its peak (likely around 2021–2022), Russian supply reached €4.44 billion. Russia's share was even more dominant by volume, reflecting its role as the low-cost, high-volume supplier via pipeline and short-sea routes.

EU sanctions triggered the most dramatic supply shock of the decade

By 2025, Russian imports had collapsed to just €158.6 million — a 96.0% decline from 2015 levels. The supply shock detection identifies this as the single largest shock event in the dataset: an abnormality score of 3.9, a value shift of −98.8% centred on 2024, and a value share of 87.2% (meaning the Russian supply disruption accounted for the overwhelming majority of the shock in import flows). This aligns precisely with the EU's phased embargo on Russian petroleum products that took full effect in February 2023, with full cessation of remaining flows by 2024–2025.

A diverse group of alternative suppliers partially filled the gap

The loss of Russian supply was offset by rapid growth from multiple alternative origins:

Iraq, Saudi Arabia, and Algeria emerged as the three principal replacement suppliers, collectively growing from €42.8 million in 2015 to €1,224.3 million in 2025. Iraq's rise from €13.3 million to €820.8 million is particularly striking, likely reflecting the country's expanding refinery capacity and its willingness to supply European refiners post-sanctions.

Import concentration dropped sharply as supply diversified

The Herfindahl-Hirschman Index (HHI) for import concentration by value fell from 7,045 in 2015 to 1,889 in 2025 — a 73.2% decline. An HHI above 2,500 is generally considered "highly concentrated"; the 2015 level was well above that threshold, reflecting Russia's dominance. The 2025 level of 1,889 sits in the "moderately concentrated" range, indicating a fundamentally more diversified — though still not highly competitive — import base. The concentration analysis confirms that the minimum HHI of 1,259 was reached at some point during the transition, suggesting an even more fragmented supply base temporarily.

Export concentration moved in the opposite direction

While imports diversified, exports became more concentrated: the export HHI rose from 4,407 to 7,331 (+66.4%). This reflects the fact that as overall export volumes collapsed, the remaining flows became concentrated in a very small number of destinations — principally Ceuta and Egypt — rather than being distributed across the many markets (US, UK, Norway, Gibraltar) that characterised the 2015 baseline.

3. Member-State Dynamics and Price Shocks

Southern European refiners absorbed the import burden

The redistribution of import volumes across EU member states was uneven. Member-state-level data reveals a clear southward shift:

Greece is the sole member state that actually increased its imports over the period, growing from €727 million to €1.09 billion. This likely reflects the continued — and possibly expanded — role of Greek refining capacity (notably the Helleniq Energy/Motor Oil complex) in processing fuel oil into higher-value products, combined with Greece's geographic proximity to Middle Eastern and North African suppliers that replaced Russian barrels. Italy, once the largest importer at €1.58 billion, saw the steepest absolute decline (−86.9%), while France's imports fell to just €11.7 million (−95.4%).

Specialisation data confirms Greece's central role

The specialisation analysis for 2025 shows Greece with a Revealed Symmetric Comparative Advantage (RSCA) of 0.8781 — the highest among all EU members — and an RCA of 15.41, indicating extreme specialisation in this product relative to total EU trade. Italy follows with an RSCA of 0.7619 (RCA 7.40). At the other end, Denmark (RSCA −1.0, RCA 0.0), Germany (RSCA −0.9965), and Sweden (RSCA −0.745) show no specialisation whatsoever, consistent with their negligible import and export activity in this product.

Two major price shocks were detected in 2021

The shock detection identifies two significant price anomalies both centred on 2021:

• United Kingdom (exports): An abnormality score of 13.9 and a price shift of +426.5%, representing 30.6% of total export value. This likely reflects the post-Brexit disruption and re-routing of fuel oil flows, combined with the early stages of the 2021 global energy price recovery.
• United States (exports): An abnormality score of 4.9 and a price shift of +347.4%, representing 20.0% of export value. This mirrors the same global energy price dynamics, amplified by transatlantic arbitrage opportunities as US refinery utilisation recovered from COVID-era lows.

Import-side volatility was dominated by Middle Eastern and North African suppliers

Among import partners, the highest coefficient of variation (CV) in value was observed for Egypt (1.21), Saudi Arabia (1.09), Algeria (1.04), and the United States (1.18) — all suppliers that entered or expanded in the EU market relatively late and whose flows remained episodic or contract-dependent. Russia, despite its eventual collapse, had a relatively lower CV of 0.45 over the full period, reflecting its long period of stable, high-volume supply before the sanctions-induced disruption. The volatility analysis provides the full picture of partner-level variability.

Conclusion

The EU's trade in process fuel oil (CN 27101951) over 2015–2025 has been defined by three intersecting forces. First, a structural contraction in both import and export volumes — imports fell by 76.6% and exports by 96.0% — reflecting the broader decline of European refining activity in this product category, likely accelerated by the energy transition and tightening fuel quality regulations. Second, the geopolitical rupture caused by the EU embargo on Russian petroleum products, which eliminated a €4+ billion annual supply relationship and forced a rapid diversification toward Middle Eastern (Iraq, Saudi Arabia) and North African (Algeria) sources. This diversification successfully lowered supply concentration (HHI from 7,045 to 1,889) but at a cost: import unit prices rose 56.3%, reflecting both higher procurement costs from more distant suppliers and the general inflation in energy commodity prices since 2021. Third, a marked shift in the geography of EU import processing, with Greece emerging as the dominant hub while traditional importers such as Italy, the Netherlands, and France saw their volumes collapse.

The market that emerges in 2025 is smaller, more expensive, more diversified in its supply sources, and more geographically concentrated in its EU-side processing — with Greece at the centre. Whether this new equilibrium proves stable or continues to evolve will depend on the trajectory of European refinery closures, the permanence of sanctions on Russian energy, and the pace of the broader energy transition away from petroleum-based fuels.