SAF Industry at a Glance
September 22, 2025
The key SAF market developments in September 2025 include:
Crude oil pricing remains uncertain but relatively stable due to geopolitical concerns and the US Fed proposed rate cuts. However, longer-term forecasts are pessimistic on prices due to an expected oversupply from OPEC+.
Airline passenger demand continues to improve globally, which also contributed to an increase in average jet fuel prices for the calendar month of August.
US SAF prices are still responding to the passing of HR 1 Bill (OBBB) into law July 4, 2025, after numerous adjustments. Included were the finalized regulations on the Clean Fuel Production Credit 45Z which has now replaced the Blenders Tax Credit. The key changes included the re-introduction of restrictions on allowable feedstocks for US renewable fuels which preclude the use of imported feedstocks except from Canada and Mexico, and the reduction of the maximum SAF credit from $1.75 per gallon to $1.00 per gallon. These changes deal a significant blow to the prospects for the US SAF industry.
US SAF feedstock imports remained stable in July across the board and continues to be volatile due to changes in low-carbon fuels production incentives. We expect material previously destined for the US to be increasingly diverted towards Europe. We believe that this will increase feedstock prices for US SAF producers, which, coupled with a benign jet fuel forecast, will put more pressure on SAF margins.
oneworld Alliance launched a new investment fund aiming to address scarcity and high cost of SAF production. The fund seeks to accelerate the international development of cost-effective, scalable SAF solutions through investment in new technologies.
Delta Air Lines has taken delivery of more than 400,000 gallons of blended SAF, produced by Montana Renewables into the Portland, Oregon, USA fuel system, which marks the first commercial-scale SAF uplift at PDX.
Our proprietary analysis of costs of production for generic US HEFA and EtJ units shows a further deterioration of margins for HEFA and a decline in EtJ margins, due to a decrease in jet prices ultimately leading to a decrease in SAF prices. EtJ margins had been improving due to declining ethanol feedstock prices and rising jet fuel / SAF prices, but that momentum was quickly halted this month.