U.S. biodiesel now costlier in Europe
A Volkswagen Jetta TDI with a biodiesel sticker at the Biofuel Oasis in Berkeley, Calif.
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Steve Chiotakis: Oil prices are around $47 a barrel as investors go back and forth over whether OPEC will announce a production cut at its meeting this weekend. Most analysts are expecting a half-million or million barrel cut per day.
Energy alternatives are suffering, too. The E.U. is slowing the flow of U.S. biodiesel into Europe. As of today, all American exporters will have to pay a tariff to sell the plant-based fuel in Europe. From the Marketplace Sustainability Desk, Caitlan Carroll reports.
Caitlan Carroll: For the past few years, the U.S. biodiesel industry has happily chugged along selling most of its output to Europe. Then fuel prices dropped. Interest in biodiesel waned. And now, the E.U. wants its producers to stay competitive with government-subsidized U.S. brands.
Enter the tariff, beginning today, that will make U.S. biodiesel a dollar or two more expensive at European pumps.
Mack Findley: I think the plan for the next four months is there will be no longer any emphasis or interest in exporting biodiesel out of the U.S. into Europe.
That's Mack Findley. He handles Sales and Marketing at biodiesel maker Peter Cremer North America.
Iowa State University economist Chad Hart says for an already small industry, this slowdown is a big blow:
Chad Hurt: I look for this to have a dampening impact on the market as a whole.
He says this could bruise the entire U.S. biodiesel industry. The E.U. will reconsider its decision in four months.
In Los Angeles, I'm Caitlan Carroll for Marketplace.