Carbon markets
Overview
Carbon markets are developing as a crucial economic lever in the challenge of reversing the accumulation of greenhouse gases in the Earth’s atmosphere, while CO2 remains a key factor in a range of industrial sectors.
National governments are embracing carbon markets, with a proliferation of carbon pricing policies worldwide. The private sector is channelling finance into projects that generate carbon emissions reductions and removals to mitigate their hard-to-abate emissions.
And the United Nations is making progress in building a global marketplace for carbon emissions reductions that will facilitate nations’ attempts to meet their obligations under the Paris Agreement.
Industrial sectors remain a key source of CO2 emissions and consumption, with innovation looking towards sustainable methods of production and utilisation.
Argus is setting the stage for an extended period of growth, evolution and interconnection of carbon market participants and initiatives.
Latest carbon markets news
Browse the latest market moving news on carbon markets.
European HVO Class IV-II spread at an all-time high
European HVO Class IV-II spread at an all-time high
London, 22 April (Argus) — The northwest European HVO Class IV–II spread reached a record high of around $450/t on Tuesday, 21 April, up from $250/t a month prior, driven by scarce Class IV offers and growing expectations of compliance-driven demand. Hydrotreated vegetable oil (HVO) Class II is produced from used cooking oil (UCO), while Class IV is made from palm oil mill effluent (Pome). Under the EU Renewable Energy Directive (RED), the contribution of Class II — along with other biofuels made from Annex IX B feedstocks — is capped in meeting the transport renewable energy target, whereas Class IV is incentivised alongside biofuels made from Annex IX A feedstocks. Biofuels made from Annex IX feedstocks are double-counted toward mandate compliance in many member states. In practical terms, the spread widened because the Class IV premium to gasoil traded higher by $95/m³ on Tuesday's Argus Open Markets (AOM), while Class II only traded higher by $20/m³. Class IV firmed because of supply-side behaviour linked to regulatory expectations, with market participants attributing the move mainly to a scarcity of Class IV offers in the Amsterdam-Rotterdam-Antwerp (ARA) hub. Expectations that the Netherlands and Germany will abolish double-counting of Annex IX feedstocks from 2026 are likely to significantly boost HVO demand this year. As higher absolute amounts of biofuel would be required to meet greenhouse gas (GHG) reduction quotas, demand for drop-in fuels such as HVO is likely to rise. Those expectations strengthened following legislative developments in Germany and the Netherlands on Tuesday. The countries are among Europe's largest biofuels consumers. In Germany, implementation of the updated Renewable Energy Directive (RED III) has been added to the parliamentary agenda on Thursday , while in the Netherlands legislation amending the Environmental Management Act and the Excise Duty Act has been ratified . Both countries — along with France, Italy and Spain — missed the 21 May 2025 RED III implementation deadline . This had raised questions about whether higher RED III targets and the removal of double-counting would apply retroactively from 1 January 2026. Most market participants now expect the changes to proceed. In parallel, use of Pome in Germany had been under question, but it is now likely to be allowed for quota generation this year, with a ban anticipated from 2027. With UCO-based HVO capped, traders said demand could increasingly shift toward advanced grades such as Class IV, leaving scope for further widening in the Class IV–II spread. Beyond physical fundamentals, market structure may also be contributing to the spread widening. The Class IV increase follows last week's first trade in the Class IV paper contract. Historically, Class IV exposure has often been hedged using the Class II contract, according to participants, but traders said the newly-launched Class IV paper instrument could allow Class IV values to decouple more clearly from the Class II benchmark, supporting a wider spread. The third quarter Class IV/Class II spread traded at +$350/t ($2,060/t, $1,710/t) on 17 April, with post trade interest described as wide. Ice launched the Argus -settled contract on 7 April. Participants can trade the contract as an outright and as a differential to front-month gasoil. Additional support for Class IV could be coming from Indonesia, where the government said on Tuesday that fuel blenders will be required to submit plans for implementing a 50pc biodiesel–fossil diesel (B50) blending mandate from 1 July. Indonesia exports refined Pome oil to Europe and Asia-Pacific, although crude Pome exports have been restricted since January 2025 . The Argus Pome oil cif ARA price rose after the news, as Indonesia may re-direct more of its Pome supply toward its biodiesel production. By Evelina Lungu HVO Class IV-II spread $/t Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
EU publishes energy crisis plans
EU publishes energy crisis plans
Brussels, 22 April (Argus) — The European Commission today published a series of actions to address what it called a "fossil energy" crisis, as the war in the Middle East continues to disrupt global oil and gas supplies. The commission estimates the EU has spent an additional €24bn on energy imports since the conflict started, reflecting higher prices and tighter supply. Commission president Ursula von der Leyen said the bloc must accelerate the shift to domestic and clean energy to strengthen energy security and reduce dependence on imports. A central element of the plan is closer co-ordination among member states, including on refilling underground gas storage and, if required, emergency releases of oil stocks, as outlined in previous drafts . To improve oversight of fuel markets, the commission confirmed it will establish a new EU Fuel Observatory from May 2026. The body will track EU production, imports, exports and stocks of transport fuels, as well as refining capacity and military fuel stocks. The commission said it will also co-ordinate with EU states, fuel suppliers, airports and airlines on sourcing and distributing alternative jet fuel supplies. Officials are assessing whether jet fuel should be included in obligatory strategic stocks. Other measures include a temporary state aid framework to support the most exposed sectors. The commission's executive vice-president Teresa Ribera said there was "no alternative" to the Green Deal, the EU's climate and energy transition strategy, adding that "citizens and businesses are paying the price of our dependency". The commission's final document addresses calls by five EU ministers for a windfall levy on energy firms, saying member states may take measures to tax windfall profits "to ensure social fairness". The commission said it will respect national decisions and share best practices. The commission also wants to increase annual renewable electricity deployment to 100GW as part of efforts to cut reliance on imported fossil fuels. The commission said it will adopt a legislative proposal by July to update the EU emissions trading system (ETS). But officials declined to give a firm timetable for publishing updated ETS benchmarks, saying only that this would happen "soon". Officials said the ETS review would increase clean energy financing via the Industrial Decarbonisation Bank, supported by €100bn, and the Investment Booster funded by 400mn ETS allowances. The commission is also considering greater support for sustainable aviation fuel (SAF) and sustainable maritime fuels through the ETS framework. While many of the measures are recommendations to member states, changes to the ETS require approval by the European Parliament. Green MEP Michael Bloss criticised the absence of an EU-wide windfall tax, the lack of concrete consumption reduction measures and delays in setting a firm electrification goal. Speed limits and home-working rules are free and sharply reduce consumption, he said. "Fuel discounts artificially stimulate demand, provide little relief and do so indiscriminately, and in the end cost consumers three times over," Bloss added. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
Greenpeace, Australia's Woodside drop emissions case
Greenpeace, Australia's Woodside drop emissions case
Sydney, 22 April (Argus) — The Australian arm of environmental campaign group Greenpeace's greenwashing suit against oil and gas producer Woodside has been dismissed from the Federal Court of Australia with the consent of both parties, they announced today. The court did not publish any ruling or decision given that both parties agreed to drop the case. Woodside and Greenpeace will bear their own legal costs, they said on 22 April. Greenpeace filed its case against Woodside on 13 December 2023 , claiming the company had misrepresented its performance on reducing greenhouse gas (GHG) emissions through carbon credit offsets. Woodside had not accounted for scope 3 emissions, which made up 90pc of its total, in its net zero 2050 ambition, Greenpeace said on 14 December 2023. Woodside also falsely claimed it had cut emissions from oil and gas extraction by 11pc in 2022, while increasing GHG output by 3pc, Greenpeace said. Woodside's climate report was subsequently rejected by 58pc of investors in April 2024 due to concerns about the company's emissions reductions plans beyond 2030. Greenpeace said Woodside changed how it was presenting its carbon emissions reduction plans while the case progressed, taking that "as a win" despite the dismissal announced today. Woodside removed a banner from its website in July 2025 stating its goal to reach net zero by 2050 or sooner, the climate activism group noted. Woodside, in turn, said it welcomed the outcome. The firm was the eighth-largest emitter under Australia's National Greenhouse and Energy Reporting Act in the July 2024-June 2025 fiscal year, at 8.2mn t of CO2 equivalent (CO2e) of scope 1 emissions. Its North West Shelf Project operation surrendered the most carbon credit units under the safeguard mechanism for that year. By Juan Weik and Daniel Gage-Brown Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
US House task force readies new biofuel policy
US House task force readies new biofuel policy
New York, 21 April (Argus) — A group of Republican US lawmakers has returned to an earlier idea for reforming biofuel policy that would prevent larger companies from winning exemptions from biofuel blend mandates, but with a new carve-out for refineries at risk of closing. The US House of Representatives task force has been debating the thorny issue for months, hoping to arrive at a final bill that would limit so-called small-refinery exemptions and expand access to a cheaper gasoline blend that contains more ethanol. The council's latest plan, according to five people familiar with the plan and bill text seen by Argus , would restrict exemption eligibility to companies with no more than 75,000 b/d of total refining capacity starting in 2028. The bill closely tracks a January proposal negotiated in large part by the American Petroleum Institute and ethanol advocates. That plan was removed from legislation to fund the government earlier this year amid backlash from some oil refiners. The House task force has more recently floated other ideas, including capping the annual impact of exemptions but letting various companies apply, but those plans failed to earn support from refiners and oil-friendly lawmakers. The latest proposal, like earlier drafts, would allow year-round sales of gasoline blends containing 15pc ethanol (E15), which farm groups have pitched as a way to help corn growers and drivers alike. Regulators for years have taken emergency action to waive summertime E15 limits that prevent its sale in much of the US, but permanent access requires legislation. The latest bill comes after President Donald Trump's administration last month set record-high biofuel quotas despite concerns from refiners that the mandates would spill into already-rising pump prices. Oil companies comply with the program by blending biofuels themselves or buying often-costly Renewable Identification Number (RIN) credits from those that do. Refineries that process no more than 75,000 b/d of crude currently can apply for the annual hardship exemptions, which farm groups and biofuel refiners say hurts demand for their products. But under the latest proposal, only companies with 75,000 b/d or less of collective refining capacity across all their facilities could qualify for relief starting in 2028. Those refiners would win automatic 75pc exemptions from biofuel quotas. That would reduce the pain of the mandates on smaller refiners like Ergon but would cut off larger companies that own smaller units, including oil majors like Chevron and mid-sized refiners like HF Sinclair and Par Pacific. The proposal could soon be sent to the House Rules Committee in hopes that lawmakers agree to add it as an amendment to the Farm Bill, a major agricultural policy package historically adopted every five years, people close to the debate said. 'At-risk' refineries carve-out The one notable addition to prior proposals is a special carve-out for "at-risk" small refineries, an effort from lawmakers to assuage oil company concerns that rising biofuel mandates threaten US refining capacity. Small refineries, including those that are part of larger companies, could request these special exemptions if they can prove that they are at an "imminent risk of closure" or that they are converting into a refinery that makes biofuels instead. But that carve-out would be capped each year, starting at 150mn RINs in 2028, limiting the potential relief if multiple facilities warn they could soon idle. The Trump administration exempted nearly 1bn RINs from blend requirements for the 2024 compliance year. Another holdover from earlier drafts is a provision compensating some unnamed small refinery owners for past compliance by returning to them special RINs that do not expire. A framework shared with Argus earlier this year, tied to an earlier E15 proposal, estimated regulators could give those companies 363mn special RINs under the provision. The proposed reforms would make the program more predictable, after different presidential administrations have whipsawed from rejecting exemption petitions en masse to granting them generously. But lawmakers' past ideas have been received coolly by farm and oil interests alike, and there is no guarantee the latest plan will be added to larger legislation that could win passage in the closely divided Congress. Some Republicans in the US Senate, including agriculture committee chair John Boozman, support E15 but have been wary of limiting small-refinery exemptions. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
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