Accoding to or As per Euro-5, the maximum sulphur content should be 10 ppm, as Sulphur content is one of fuel proprieties, which has the most considerable influence on particulate emissions ..

Sulphur is the main primary culprit for the formation of soot which is noxious. Elimination of sulphur or significant reduction has a great effect on the reduction of soot. Of course it also reduces "lubricity" diesel but that can be addressed in other ways.

Sulphur is a strong contributor to the increase of insoluble fraction of particulate. In addition sulphur in the exhausts il noxious to The aftertreatment system of particulate.

Typically, fuel lean operating condition of diesel engine, excess air reacts with sulfur content in diesel fuel and forms oxides of sulfur which can readily be turned into sulfuric acid in the present of water/moisture.  It certainly is environmental problem.  As experienced in refinery, sweet crude is prefer but, of course, higher price than sour crude.  However diesel hydro-desulphurization process is used to remove sulfur content in diesel to the lowest level as possible.  It produces better quality and environmentally diesel fuel but costly for refinery.

Instead of just looking at Sulphur level in ppm mass, one has to get deeper on the type of sulphur that shall be refractory and tougher to get it removed from diesel or gasoline fractions. The residual sulphur will be mostly thiophene between aromatic rings and would not get burnt easily in milli sec operation in an IC engine leading to PM2.5 emissions. Along with sulphur, PAH and end point have influence on tail pipe emission and indicate relative ease of total burning desired. Also, extending life of engine oil used needs lower pick up of impurities during run which again calls for ultra low sulphur diesel. Further, there is always a trade off between NOx and PM2.5 emissions in a diesel engine which to some extent can be corrected by having tail pipe catalyst which again need lower sulphur compounds in exhaust gas.