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Singapore 0.1pc sulphur MGO sales keep rising

13 Jun 2017 21:11 (+01:00 GMT)
Singapore 0.1pc sulphur MGO sales keep rising

New York, 13 June (Argus) — Singapore sales of 0.1pc sulphur maximum marine gasoil (MGO) have continued to grow since new emissions regulations went into effect in other markets in 2015.

During the first five months of 2017, 0.1pc sulphur MGO sales increased by 11pc to 538,900t compared with the same period last year. By contrast 0.1-1pc sulphur MGO demand dropped by 18pc to 321,300t. Data from Singapore's Maritime Port Authority (MPA) showed that MGO sulphur content averaged at 0.2pc in April.

In 2016 aggregate MGO sales in the port reached a ten-year high of 1.99mn t, after a dip down to 1.31mn t in 2014. In 2016, 0.1pc sulphur MGO accounted for 57pc of total MGO demand in Singapore.

In January 2015, the international Emission Control Areas (ECA) capped the marine fuel sulphur limit for vessels traveling within the ECAs at 0.1pc. To comply, shipowners switched from burning 1pc sulphur residual fuel oil to 0.1pc sulphur gasoil. Singapore is not designated as ECA, but some vessels which call Singapore also travel in the ECAs, which include the territorial waters of US and Canada, the North Sea and the Baltic Sea.

Argus assesses daily prices of 0.1pc sulphur MGO in the major ports within the ECAs and 1pc sulphur MGO in Singapore. In May the average MGO Singapore price was pegged at $17/t premium to Rotterdam and at $8/t premium to St Petersburg. By contrast Singapore MGO was assessed at a discount to ports in the US, including a $24/t discount to Houston and a $34/t discount to Los Angeles. Higher MGO prices at competing US ports could be contributing to Singapore's strong 0.1pc sulphur MGO sales.

On 20 June Argus will launch a new daily price assessment for Singapore 0.1pc sulphur maximum MGO. It will be added to the existing Singapore 1pc sulphur maximum MGO price assessment and will be published in the daily Argus Marine Fuels report.

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Singapore MGO sales ’000t