Posts by Hoekstra Trading LLC
Economics of Refinery Octane Part 1 – U.S. Octane Values 2016-2025
The last ten years have seen historic changes in the U.S. octane market. The retail value of octane, the primary yardstick of gasoline quality and price, has increased 5-fold. The wholesale value of octane has increased in the last 3 years, spiking threefold in July 2022, followed by another year of high values in 2023.…
Read MoreThe Octane Value of Ethanol Part 2 – Ethanol is an Outstanding Octane Additive
Most U.S. gasoline contains 10% ethanol. Among other things, ethanol is an outstanding octane booster. When considering the economic value of ethanol in gasoline, it is critical to properly account for its octane value. See other blogs in this series The Octane Value of Ethanol: The term “aromatics” is used to describe a petroleum-derived hydrocarbon…
Read MoreTop 3 Takeaways — From Infocast’s RNG & SAF Capital Markets 2025
This July 15-16, 2025 event was my first opportunity to meet those involved in Renewable Natural Gas (RNG) project financing and development. As always, exposure to another branch of the fuels ecosystem brought lots of new learning. Here’s the countdown on my Top 3 Takeaways from this event: Number 3: Doom and Gloom The second…
Read MoreTop Four Takeaways from EPA’s public hearing on the 2026-2027 RFS Standards Proposed Rule
On July 8, 2025, the U.S. Environmental Protection Agency (EPA) held a public hearing on the 2026-2027 proposed Renewable Fuels Standard (RFS) renewable fuel volume obligations and the partial waiver of the 2025 cellulosic renewable fuel volume obligation. The comment period for this EPA proposal closes August 8, 2025. Below are my top 4 takeaways…
Read MoreThe Octane Value of Ethanol Part 1- Measuring Octane Quantity With The Octane-gallon
Refiners and other gasoline enthusiasts are familiar with the concept of the octane-gallon. One octane-gallon is the quantity of octane that will raise the octane of one gallon of gasoline by one octane number. See other blogs in this series: The Octane Value of Ethanol – This week, I saw 93 octane premium gasoline priced at…
Read MoreWhat was “RINsanity”? Read This Classic 2013 Article On The Big Bang of Renewable Identification Number (RIN)s
This New York Times article described the frenzy set off by the 100-FOLD increase in the D6 RIN in 2013. Now, 12 years later, most RIN participants know what really caused that price explosion. But the market remains confused and is still often blindsided by unexpected price behaviors caused by nuances of the RIN system…
Read MoreComparing Theoretical and Market Renewable Identification Number Prices Part 5 – RIN Price Forecasting
ATTRACTOR is a spreadsheet application of the RIN price equation defined in this publication by Scott H Irwin, Kristen McCormack and James H Stock. Since its Release in October, 2020, ATTRACTOR has been used by Hoekstra Trading clients to calculate theoretical Renewable Identification Number (RIN) prices based on economic fundamentals and compare them to market…
Read MoreComparing Theoretical and Market Renewable Identification Number (RIN) Prices Part 4 – Over-Reaction to Regulatory Policy Changes
A May 15, 2025 rumor said the Renewable Volume Obligation (RVO) levels for biobased diesel for years 2026 and following would be set at less than 5 billion gal/y, at a time when the market was expecting it will be a higher number. Read other blogs in this series – Comparing Theoretical and Market RIN…
Read MoreTop 3 Takeaways From Fastmarkets Biofuels and Feedstocks Americas 2025 Conference
Number 3: What is the status of U.S. biodiesel production? U.S. biodiesel production (not including plants that use hydroprocessing technology, which are commonly known as renewable diesel plants) is running at half capacity. Some biodiesel plants are not producing at all now, but are keeping a full staff who are doing other work like maintenance…
Read MoreComparing Theoretical and Market Renewable Identification Number (RIN) Prices Part 3 – Anticipating Changes in Tax Subsidies
Read other blogs in this series – Comparing Theoretical and Market RIN Prices: Figure 1 (whose title says Fig. 2) shows a copy of Figure 2 extracted from the published Irwin-McCormack-Stock (IMS) article that defines D4T and the ATTRACTOR model. In Part 2 of this series, I said this chart: Shows that the D4 RIN…
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