Saudi Petrochemical and Metals Exporters: Building CBAM-Ready Carbon Data

Saudi exporters of aluminium, steel and fertilisers now face the EU Carbon Border Adjustment Mechanism (CBAM). Since 1 January 2026, the carbon in each tonne sold into Europe has carried a cost, and a buyer who cannot get a verified carbon figure from its supplier must use a default value with a mark-up.

Petrochemicals are different. Most polymers and organic chemicals sit outside CBAM today, so the exposure for Saudi exporters in 2026 is narrower, and more concentrated in metals, than many industrial CFOs assume.

Spectreco, a US-headquartered sustainability technology and advisory company with offices in Atlanta, Dubai, Muscat and Lahore, helps industrial exporters turn plant data into figures that buyers, verifiers and lenders accept. This article sets out which Saudi products are exposed, what carbon data CBAM requires, and where reporting aligned with the International Sustainability Standards Board (ISSB) helps.

What Does EU CBAM Require of Saudi Exporters?

Direct answer: CBAM charges EU importers, not Saudi producers. Importers above the 50-tonne threshold must be authorised declarants and surrender certificates for carbon embedded in six covered sectors. To price actual emissions instead of defaults, they need verified installation-level data from their Saudi suppliers.

The six sectors are cement, iron and steel, aluminium, fertilisers, hydrogen and electricity. Certificate sales open on 1 February 2027, and the first annual declaration, covering 2026 imports, is due by 30 September 2027. Importers bringing in 50 tonnes or less a year, counted across iron, steel, aluminium, fertiliser and cement goods, are exempt.

The 2026 certificate price follows the quarterly average of EU Emissions Trading System (ETS) auction prices. Default values are country-specific, fall back to the average of the ten highest-emitting exporting countries where data is thin, and add a mark-up that starts at 10 percent in 2026 for most goods. A supplier without verified data costs its buyer more.

Sources: European Commission, CBAM definitive regime, Mayer Brown, CBAM Simplification Regulation, ICAP, EU CBAM enters compliance phase, HSF Kramer, Operationalisation and simplification of the EU CBAM

For the full rule set, see our guides to GCC exporters and EU CBAM and the 2026 CBAM simplification.

Which Saudi Exports Are Covered by CBAM, and Which Are Not?

Direct answer: Aluminium, iron and steel, and fertilisers are the covered Saudi exports that matter for EU trade today. Polymers, most petrochemicals, crude oil and refined products are not covered. Metals carry most of Saudi Arabia’s CBAM exposure, while petrochemicals face buyer pressure rather than a border charge.

The trade data show where the money sits. The EU imported US$385 million of goods under the aluminium chapter from Saudi Arabia in 2025, including US$235 million of unwrought metal. About US$63 million of that was scrap, which CBAM does not cover, so roughly US$322 million is in scope. Iron and steel added US$219 million, mostly flat-rolled products.

Saudi fertilisers recorded under the fertiliser chapter reached the EU at only about US$3 million. An ORF Middle East brief put Saudi CBAM-covered exports to the EU at US$565 million in 2023, and found aluminium made up 68 to 75 percent of covered exports from Saudi Arabia, the UAE and Oman.

Sources: UN Comtrade via Trading Economics, EU imports of aluminium from Saudi Arabia, UN Comtrade via Trading Economics, EU imports of iron and steel from Saudi Arabia, UN Comtrade via Trading Economics, EU imports of fertilisers from Saudi Arabia, ORF Middle East, The EU’s CBAM and Gulf Countries

Why Petrochemicals Are Outside CBAM, for Now

In 2025 the EU imported €1.8 billion of Saudi plastics and rubber and €1.7 billion of chemical and allied products, far more than the €649 million of base metals. Apart from a few covered lines such as ammonia, those products sit outside CBAM.

The CBAM Regulation left organic chemicals out because their embedded emissions could not yet be clearly defined, and the Commission was asked to assess extending CBAM to organic chemicals and polymers. Saudi petrochemical exporters are not exempt from carbon scrutiny. They are simply facing buyers and lenders before they face the border.

Sources: European Commission DG Trade, EU-Saudi Arabia trade factsheet, Sandbag, Chemicals in the CBAM, European Parliament Legislative Observatory, CBAM summary

Three Developments That Widen the Net

• Downstream goods: the Commission proposed in December 2025 to add 180 steel- and aluminium-intensive products from 1 January 2028, and both the Council and Parliament’s environment committee have proposed widening that list.
• Chemicals review: the Regulation asked the Commission to assess extending CBAM to organic chemicals and polymers, and ICAP reports the Commission will use 2027 to assess possible scope expansion, including more EU ETS sectors.
• UK CBAM: from 1 January 2027 the UK charges importers of aluminium, cement, fertiliser, hydrogen and iron and steel, and requires accredited verification of actual emissions data.

Sources: European Commission, CBAM package press release, European Parliament Research Service, CBAM downstream extension, ICAP, EU CBAM enters compliance phase, GOV.UK, CBAM policy summary

What Carbon Data Do Saudi Manufacturers Need for CBAM?

Direct answer: CBAM needs installation-level, product-level data. That means tonnes of CO2e per tonne of each covered good, calculated on the EU method. An accredited verifier must confirm it. A company-wide Scope 1 and Scope 2 total does not meet that standard.

Installation-level, per-tonne emissions

The Commission’s method starts from the installation, a stationary technical unit where a production process is carried out, and divides its emissions across the goods it makes. A Saudi producer must be able to show:

• Boundary and route: the installation, its production processes and the production route for each covered good.
• Direct emissions per tonne: for aluminium and steel goods, direct emissions count. For aluminium that includes perfluorocarbons from anode effects, and electricity used in smelting is excluded. Sintered ore used in steel is the exception and carries its electricity emissions.
• Fertiliser specifics: fertilisers and cement also count emissions from electricity, and fertilisers add nitrous oxide.
• Precursors: for complex goods, the embedded emissions of input materials, backed by a verification report for the production period.
• A monitoring methodology: a documented plan that an independent verifier can follow.

Sources: European Commission, CBAM Guidance No. 3, calculation of embedded emissions, European Commission, CBAM Guidance No. 5e, aluminium, European Commission, CBAM Questions and Answers

Verification by an accredited verifier

Actual values must be verified by an independent verifier accredited under the EU system. Verifiers based outside the EU can apply to an EU national accreditation body that offers CBAM accreditation.

Non-EU producers can upload installation data once through the CBAM Registry operator portal, so each EU importer can use it in its declaration.

Sources: European Accreditation, The EU CBAM and the role of accreditation, European Commission, CBAM Registry

Sustainability assurance is a different test. Maaden’s 2024 report says selected indicators received limited assurance from Bureau Veritas, and its aluminium operations hold Aluminium Stewardship Initiative certification valid to July 2027. Both signal data discipline. In our view, neither replaces CBAM verification of a per-tonne figure.

Sources: Maaden, Sustainability Report 2024, Aluminium Stewardship Initiative, Maaden Aluminium audit report

How Does ISSB-Aligned Reporting Feed CBAM Data?

Direct answer: IFRS S2, the ISSB climate standard, requires entity-level Scope 1, 2 and 3 emissions under the GHG Protocol. It supplies the activity data, controls and ownership CBAM needs. It does not supply the CBAM number. That figure is per installation and product, so the data must be re-cut.

The two systems count differently. IFRS S2 measures gross emissions across an entity’s chosen GHG Protocol boundary, unless a local authority requires another method. CBAM measures what the Commission calls a partial footprint, built around the emissions the EU ETS would cover if the plant sat in the EU, per tonne of product.

A Saudi aluminium producer’s corporate Scope 1 and 2 total will therefore not match its CBAM figure, because aluminium under CBAM counts direct emissions only and leaves electricity out. What carries over is the layer underneath: fuel and material data, meter readings, ownership and controls. One governed data source can feed both once it is cut by installation and product.

Sources: IFRS Foundation, IFRS S2 greenhouse gas emissions educational material, European Commission, CBAM Guidance No. 3

As far as we can tell, Saudi Arabia has not announced a mandatory IFRS S2 date for listed companies. The Capital Market Authority and Saudi Exchange encourage ESG disclosure, so for most exporters the first request for this data comes from an EU buyer, not a regulator.

Sources: Anthesis, Mandatory Sustainability Reporting in the Middle East, Keslio, Saudi Arabia sustainability reporting requirements

Our guide to Saudi ISSB reporting tracks the position, and our Qatar CBAM article shows how a neighbouring exporter base faces the same rules.

How to Build CBAM-Ready Carbon Data in Five Steps

1. Map your covered products. List each export by customs code and note which go to the EU or UK, so effort follows real obligations.
2. Fix the installation boundary. Define each installation, its production processes and routes, the way a verifier will test them.
3. Capture source data. Collect fuel, material and meter data per process, with named owners and a written monitoring methodology.
4. Calculate per-tonne emissions on the EU method. Apply the sector rules: direct emissions plus perfluorocarbons for aluminium, direct emissions for steel, and electricity plus nitrous oxide for fertilisers.
5. Verify, share and reuse. Have an accredited verifier confirm the figures, give them to importers through the operator portal, and reuse the same data for IFRS S2 and buyer requests.

Spectreco’s AI cloud-native sustainability platform holds this data in one governed source. Verification itself stays with an accredited third party. Plants that also need to cut the number can pair it with our decarbonisation advisory.

Frequently Asked Questions (FAQs)

For further reading, see the Spectreco guide to GCC exporters and EU CBAM.

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Turn Your Plant Data into CBAM-Ready Numbers

Saudi exporters can meet CBAM, UK CBAM and buyer requests from one governed data source, if it is built before the buyer asks. Spectreco’s CBAM carbon-data readiness assessment maps which products are covered, tests your installation data against the EU method and shows what a verifier will ask for.

It is delivered as advisory or through a Virtual Sustainability Office. Book a Spectreco CBAM carbon-data readiness assessment to find the gaps before your EU importer does.