BAKU, Azerbaijan, Aug.5. A bullish long-term price outlook for diesel could accelerate the fuel’s ‘phase out’ from several key markets for both cost and environmental considerations, starting with usage in the transport sector, Trend reports with reference to Fitch Solutions.
The company’s latest report reveals that the sector is oft blamed for generating the most pollution and is also where diesel use is among the heaviest, especially among heavy vehicles.
“However, as global decarbonisation efforts accelerate, many are also setting in place ambitious targets for car fleet electrification, phasing out internal combustion engine (ICE) cars, rolling out generous incentives to encourage purchases of and spur investments into lower-emissions alternatives. All of the 10 largest diesel markets in the world (led by those in Europe) have plans to significantly increase the penetration of EVs, plug-in hybrids and other lower-emission models as a share of new car sales by 2030, with the more ambitious looking towards a full phase-out by 2040,” reads the report.
Asian DMs, as well as the likes of China and India, are also starting to match their European counterparts in adopting robust emissions reduction plans and aiming to phase out diesel cars from roads, citing the propensity of diesel engines for emitting harmful particulate matters.
“However, the feasibility of these targets is contingent on simultaneous developments in the necessary ancillary infrastructure, such as charging stations. Even in the smaller EMs, where a total phaseout of diesel engines is not yet feasible or under consideration, there are plans to encourage the use of more efficient diesel grades, or replace ‘pure diesel’ with more bio-components to curb air pollution,” say Fitch Solutions’ analysts.
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