South Korea’s leading oil refiner SK Energy Co. has shipped hydrotreated vegetable oil (HVO), a high-value, eco-friendly fuel, to Europe this year, following last year’s success.

According to sources from the refining industry on Sunday, SK Energy exported approximately 6,000 tons of HVO produced at its Ulsan refinery to Europe in June.

This marks the company’s second HVO export to Europe, following the first shipment of about 5,000 tons in December 2024.

The shipment is expected to arrive in Europe in mid-August 2025, sources said.

HVO is a next-generation biodiesel fuel produced by adding hydrogen to vegetable-based feedstocks such as used cooking oil.

It is used as an alternative fuel for internal combustion engines, including trucks, buses, and conventional diesel vehicles.

Unlike first-generation biodiesel, HVO is a drop-in fuel that can be directly substituted in diesel engines.

It is known to reduce greenhouse gas emissions by up to 90 percent compared to first-generation biodiesel.

Industry experts anticipate that global HVO demand will continue to rise due to stricter biofuel blending mandates and decarbonization regulations by the European Union (EU).

The EU already requires at least 29 percent of transport fuels to come from renewable energy sources by 2030 under its Renewable Energy Directive (RED).

European HVO prices recently hit a seven-month high, driven by increasing demand due to tighter carbon regulations, while international HVO prices reached $ 2,216 per ton as of June 20 and continue to trend upward.

“HVO is gaining attention as a high-value eco-friendly fuel amid strengthening carbon regulations, with demand surging in Europe,” an industry official noted. “HVO consumption in Europe is expected to hit an all-time high by 2026.”

Against this backdrop, SK Energy is accelerating its strategy to target the low-carbon transportation fuel market with HVO and sustainable aviation fuel (SAF) as its two key pillars.

Both fuels are considered next-generation energy sources to replace fossil fuels, with strong demand anticipated due to the EU’s stricter decarbonization policies and expanded biofuel blending mandates.

SK Energy began mass production of SAF at its Ulsan refinery in 2024 and completed its first SAF export to Europe in January 2025.

It also signed an agreement to supply more than 20,000 tons of SAF to Cathay Pacific Airways Ltd. in Hong Kong by 2027.

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