The Kingdom Enters the Biofuel Arena
When people think of Saudi Arabia and energy, oil is the inevitable association. But the Kingdom’s Vision 2030 programme is rewriting that narrative — and biofuels are emerging as an increasingly important chapter in the story.
Through the Saudi Green Initiative (SGI) and the Circular Carbon Economy National Program, Saudi Arabia has committed to reducing carbon emissions by 278 million tonnes annually by 2030. The investment is substantial: the SGI alone represents a commitment of approximately $187 billion across environmental and sustainability initiatives. Within this framework, biodiesel produced from used cooking oil (UCO) is gaining recognition as a practical, deployable solution for decarbonising transport and industrial sectors.
Domestic Production Is Scaling Up
Saudi Arabia’s biodiesel production capacity is expanding rapidly. The Biofuel Company operates what is described as the Gulf’s largest biofuel refinery in Jubail, currently refining 12 million litres of B100 biodiesel annually from reclaimed cooking oil and palm oil. Plans have been announced to triple this capacity with new facilities in Jeddah and Riyadh, bringing total national production to 36 million litres.
In a significant development in 2025, King Salman Airport signed a memorandum of understanding with the Biofuel Company for B100 deployment in airport construction operations, replacing fossil diesel in alignment with Vision 2030 sustainability targets. This signals that Saudi institutions are moving beyond pilot projects toward operational deployment of biofuels.
UCO Collection: A Regulatory Turning Point
Perhaps the most significant development for the UCO sector is the regulatory direction Saudi Arabia is taking regarding waste cooking oil. Under international waste management agreements, the Kingdom is moving to reprocess its own waste into energy rather than exporting it. Government bodies are reviewing policies around UCO export restrictions, with some Royal Commissions already mandating UCO-to-biodiesel conversion within their jurisdictions.
The UAE’s approach has provided a reference model. With established UCO collection networks, licensed operators, and a national biofuel policy framework already in place, the UAE demonstrates what a mature UCO-to-biodiesel ecosystem looks like. For Saudi Arabia, the opportunity is to build on this precedent while leveraging its own massive food service sector — the Kingdom generates enormous volumes of UCO from its hospitality and restaurant industries.
Cross-Border Opportunities
The development of biofuel capacity across both the UAE and Saudi Arabia creates potential for a GCC-wide biofuel ecosystem. Shared standards, cross-border feedstock agreements, and coordinated regulatory frameworks could amplify the impact of individual national programmes.
For UCO collectors and biodiesel producers operating in the UAE, Saudi Arabia’s expanding market represents both an opportunity and a validation of the waste-to-fuel model. The fundamental economics are the same: waste cooking oil that would otherwise cause environmental harm is transformed into clean, certified fuel that displaces fossil diesel.
The Bigger Picture
Saudi Arabia’s entry into the biofuel sector at scale sends a powerful signal. When the world’s largest oil producer invests in waste-derived renewable fuels, it validates the technology, the economics, and the environmental case for biodiesel.
For businesses across the GCC generating used cooking oil, the message is clear: your waste stream has strategic value. As both the UAE and Saudi Arabia build out their biofuel infrastructure, demand for certified, traceable UCO feedstock will only grow.
Neutral Fuels has been at the forefront of UCO collection and biodiesel production in the Gulf since 2011. Contact us to learn how your business can participate in the region’s biofuel transition.
