Europe’s growth in diesel demand stemming from its
emphasis on diesel-fueled light-duty vehicles has risen from Europe’s desire
to reduce consumption.
It has been encouraged
by tax and vehicle purchase incentives.
Furthermore, Europe’s particulate and NOx emission requirements for
these diesel-fueled vehicles are less stringent than in the U.S.
surge in penetration was
possible because the manufacturing and
base for these vehicles was in place, and consumer acceptance was established.
That is, Europe had a firm base from which
the recent growth could spring.
not the case in the U.S.
As we look to the
future, Europe’s challenge will be how best to continue meeting its distillate
sources of imports (FSU and Middle
may be limited in their ability
to increase supply, particularly now that Europe has moved to low sulfur
Europe is a major market force
in the Atlantic Basin, and as its need for distillate increases, the relative
price of diesel and gasoline may change, and any price pressure will be felt
in the United States.