More than 14 countries and over 20 cities around the world are planning to ban the sale of passenger vehicles (primarily cars and buses) powered by fossil fuels such as petrol, liquefied petroleum gas and diesel to varying degrees by 2040.
Reasons to ban further sale of fossil fuel vehicles include reducing health risks from pollution, notably diesel PM10s and other emissions; meeting national greenhouse gas targets under international agreements such as the Paris Agreement; as well as to reduce energy dependence.
Singapore is moving a step closer to the petrol and diesel car ban by ceasing registration of new diesel cars and taxis from 2025 onwards. The announcement was made by Mr Ong Ye Kung, the Minister of Transport on 4 March 2021, effectively making Singapore the first in Asia to implement a total diesel ban. This measure will bring the nation closer to achieving its sustainability agenda.
As part of the national sustainability agenda, electric vehicles (EV) will take over diesel cars on the Singapore roads. To find out how the rise of EV can potentially impact PGM demand, check out another of our opinion piece here.
Here is an overall view on the diesel vehicle regulations landscape in Asia:
Based on Singapore Land Transport Authority’s website, there are 24,584 registered diesel passenger cars and taxis in 2020. For registered diesel taxis it has been on gradual decline, probably due to taxi companies favouring various factors such as petrol vehicles being less noisy, lesser particulate matter (PM) released, and the 2015 to 2017 Volkswagen test cheat scandal. However, diesel passenger cars in Singapore have not been on much decline as of now; any consumer market shifts are yet to seen.
Singapore’s upcoming cleaner-energy vehicle regulations. Source: Ministry of Transport
In terms of pollutant levels permitted from diesel vehicles, the latest global standards for sulphur concentration are to be at 10 ppm. In Asia, Japan, Korea, Singapore and China were the first 4 countries to implement these standards, from the period of 2007 to 2013. Later Asia countries that jumped on the bandwagon of this new sulphur standard includes Cambodia (2017), India (2020), and Vietnam (2021). Thailand is slated to embark on this from 2023.
During the ASEAN-based mobility conference in 2018, Mr Ray Minjares, Clean Air Program Lead of the International Council on Clean Transportation shared that based on World Bank’s data, half of deaths from motor vehicle air pollution occur in Asia. He expounded the PM emitted from diesel vehicles plays a part in these deaths. He urged for ASEAN countries to roll out Euro VI regulations sooner to bring down these PM emissions.
Will diesel ban impact platinum pricing?
The main usage of platinum is in catalytic converters, especially so in diesel catalytic converters. With all these recent regulations and trends that restricts diesel vehicle usage, will these drive down market demand for platinum? Will countries even follow Singapore’s lead in banishing new diesel cars and taxis from their roads sooner than we imagine?
In the last 12 months, despite moderate fluctuations here and there, platinum pricing is on the rise overall, and an over 300% jump was observed in last 6 months or so. Unless there’s unexpected market movements, platinum will hold its value well into the next quarter.
Do you perceive a major dip in platinum demand and subsequently its price when 2025 approaches? We would love to hear from you- simply reach out to us at email@example.com