Biological fuel prices jump as the conflict pays Israel Iran in search of oil alternatives

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The prices of palm oil and soy oil increased after the conflict between Israel and Iran raised energy costs, and the Trump administration suggested an increase in the amount of mixed biofuels in diesel and gasoline.

Soy oil jumped by 11 percent since Thursday, to reach its highest level since October 2023 with more than 55 cents per pound. Palm oil, which was declining this year due to The abundance of the showHe gained more than 6 percent to nearly 4,100 rougrits per ton this week.

These eating oils are required amid the search for cheaper energy sources, driven by about 8 percent of Brent crude jump since Israel fired air strikes against the nuclear program and military facilities in Tehran at the end of last week.

“The main factor in this jump is due to energy prices and crude prices, due to this conflict,” said Darren Lim, a strategic expert on commodities in the brokerage in Singapore, adding that the oil -fitting oil prices track grains in crude in Singapore.

“The high energy prices increase the costs of palm oil production as well as possible demand BiofuelBecause it works as an alternative source of energy. “

The motivation behind the gains of the Environmental Protection Agency in the United States was also to increase the amount of biofuels that refining refineries need to mix in diesel and gasoline by 8 percent to a record number 24.02 billion gallons next year.

The plan includes an increase of 67 percent in the target amount of biomass-based diesel-usually made of soy oil and cooking oil used-to 5.61 billion gallons. This was higher than 5.25 billion gallons proposed by US oil and biofuels earlier this year, and it was a welcome surprise for budget -end commodity merchants.

The Environmental Protection Agency also criticized half the number of compliance assets granted to biofuels made of foreign raw materials, such as Canadian or Chinese Canadian cooking oil. These credits are created when BIOFUELS is produced or imported, and companies can buy or sell to meet the annual biofel mixing stakes in EPA.

This step works on a competitive advantage for American producers and helps support soy domestic demand. It follows pressure from both the oil and biofuel industries, and analysts are also seen as a political step to help American farmers fell into the intersection Trump’s turbulent trade policy.

“If you put these two parts together, it was a very issued advertisement for us soy oil,” said Charles Hart, Rabobank, chief of commodity analyst. He also referred to the data from The National Oils Association for Oil seeds Soy oil stocks fell to 1.37 billion pounds at the end of May, 20 percent less than a year and the lowest level in May since 2004.

“The domestic demand has increased the authorization, support from the high prices of crude and more compromise,” he added.

Imported raw materials are an increasing share of diesel -based diesel inputs in recent years.

The speculators cut their long net sites in the soy oil futures in the week leading to the announcement of the Environmental Protection Agency, according to the data of the Justice Contracts Trading Committee. Hart said that the announcement of the Environmental Protection Agency has proven to be more positive for the United States industry than expected, as speculators bought inverse positions, which may have fed the march.

Lim said that palm oil, the cheapest large eating oil, tends to track soy oil prices closely, especially in the main imported markets such as India, where consumers often turn between the two according to the price. Indian consumers recently increased the purchases of palm oil after a reduction in the import of taxes.

The high prices of high drilling fuels and a historical rise are historically driven in the cheapest alternative energy sources, including biofuels.

“The development of biofuels – not only in the United States but globally – is linked to energy security,” Hart said, citing geopolitical risks and efforts to reduce energy import bills. “It also provides some insulation against external shocks in the global crude market.”

American soy farmers have carried years of commercial turmoil, especially due to the battles of the Trump administration’s tariff with China, which reduced a major export market. Recently, they have faced a difficult mix of global prices, high input costs and slow export demand.

Trump has long tried to balance the interests of both fossil fuels and biofuels, and two influencing blocks in the heart of the United States. In his first term, repeated concessions of small oil refineries angered atom and soybeans, the main components in swinging cases such as Iowa.

“This is a measure of supporting the soy sector in the United States at a time of the relative uncertainty of exports, given the current tensions in the US -Chinese trading relationship,” said Hart.

General listening sessions on the proposal of the Environmental Protection Agency are scheduled to be held on July 8, but the final decision may take months. Meanwhile, analysts expect continuous volatility in the vegetable oil markets.

“This depends on the size and duration of the period in which this Middle East crisis will continue,” said Philip Nova Lim. “If the intensity remains the same, but it continues, the prices may explode slowly. But if they escalate, you will see a quick reaction.”