Overview

The marine fuel sector is decarbonising. International Maritime Organization (IMO) requirements and EU legislation is driving this change alongside consumer demand for low carbon solutions. 

These drivers have prompted shipowners to invest in alternative marine fuels including; marine biodiesel, bio-methanol, grey methanol, LNG, ammonia and hydrogen.

Argus provides pricing, insights, and intelligence for the fast-growing alternative marine fuels market with independent news, analysis, and market commentary on emerging changes and trends so you can stay ahead.

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Argus Market Highlights: Marine Fuels

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Latest alternative marine fuels news

Latest alternative marine fuels news
19/09/24

LNG-burning vessels well positioned ahead of 2025

LNG-burning vessels well positioned ahead of 2025

New York, 19 September (Argus) — Vessels outfitted with dual-fuel LNG-burning engines are poised to have the lowest marine fuel expense heading into 2025 when the EU will tighten its marine EU emissions trading system (ETS) regulations and add a new regulation, " FuelEU", from 1 January 2025. Considering both regulations, at current price levels, fossil LNG (also known as grey LNG) will be priced the cheapest compared with conventional marine fuels and other commonly considered alternative fuels such as biodiesel and methanol. The EU's FuelEU maritime regulation will require ship operators traveling in, out and within EU territorial waters to gradually reduce their greenhouse gas (GHG) intensity on a lifecycle basis, starting with a 2pc reduction in 2025, 6pc in 2030 and so on until getting to an 80pc drop, compared with 2020 base year levels. The FuelEU GHG intensity maximum is set at 85.69 grams of CO2-equivalent per MJ (gCO2e/MJ) from 2030 to 2034, dropping to 77.94 gCO2e/MJ in 2035. Vessel pools exceeding the FuelEU's limits will be fined €2,400/t ($2,675/t) of very low-sulphur fuel oil (VLFSO) energy equivalent. GHG emissions from grey LNG vary depending on the type of marine engine used to burn the LNG, but ranges from about 76.3-92.3 gCO2e/MJ, according to non-governmental environmental lobby group Transport & Environment. This makes a number of LNG-burning, ocean-going vessels compliant with FuelEU regulation through 2034. The EU's ETS for marine shipping commenced this year and requires that ship operators pay for 40pc of their GHG generated on voyages within, in and out of the EU. Next year, the EU ETS emissions limit will increase to 70pc. Even with the added 70pc CO2 emissions cost, US Gulf coast grey LNG was assessed at $639/t VLSFOe, compared with the second cheapest VLSFO at $689/t, B30 biodiesel at $922/t and grey methanol at $931/t VLSFOe average from 1-18 September (see chart). "In 2025, we expect [US natural gas] prices to rise as [US] LNG exports increase while domestic consumption and production remain relatively flat for much of the year," says the US Energy Information Administration. "We forecast the Henry Hub price to average around $2.20/million British thermal units (mmBtu) in 2024 and $3.10/mmBtu in 2025." Provided that prices of biodiesel and methanol remain relatively flat, the projected EIA US 2025 LNG price gains would not affect LNG's price ranking, keeping it the cheapest alternative marine fuel option for ship owners traveling between the US Gulf coast and Europe. LNG for bunkering global consumption from vessels 5,000 gross tonnes and over reached 12.9mn t in 2023, according to the International Maritime Organization (IMO), up from 11mn t in 2022 and 12.6mn t in 2021. The maritime port authority of Singapore reported 111,000t of LNG bunker sales and the port authorities of Rotterdam and Antwerp reported 319,000t in 2023 from all size vessels. Among vessels 5,000 gross tonnes and over, LNG carriers accounted for 89pc of LNG bunker demand globally, followed by container ships at 3.6pc, according to the IMO. The large gap between LNG global and LNG Singapore, Rotterdam, and Antwerp bunker demand, is likely the result of most of the demand taking place at the biggest LNG export locations where LNG carriers call, such as the US Gulf coast, Qatar, Australia, Russia and Malaysia. By Stefka Wechsler USGC bunkers and bunker alternatives $/t VLSFOe Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Latest alternative marine fuels news

Advanced Fame marine biodiesel blends hit 9-month low


18/09/24
Latest alternative marine fuels news
18/09/24

Advanced Fame marine biodiesel blends hit 9-month low

London, 18 September (Argus) — Some marine biodiesel blend prices in northwest Europe hit a year-to-date low on 17 September, owing to soft fundamentals and easing values in underlying markets. Argus assessed the prices of B30 and B100 Advanced fatty acid methyl ester (Fame) 0 dob ARA — which include a deduction of the value of Dutch renewable fuel tickets (HBE-G) — at $674.01/t and $993.87/t, respectively. At these levels, the two blends were at their lowest outright price since 29 December last year — right before values rose sharply following the halving of the Dutch HBE-G multiplier for maritime blending at the start of the year. Prices have slipped on the back lacklustre demand for marine biodiesel blends in recent months. The price of EU Emissions Trading System (ETS) allowances, for which Advanced Fame marine biodiesel blends receive a zero emission factor, have averaged $70.56/t so far this year, compared with $93.43/t in the same period last year. Consequently, the expansion of EU ETS into the shipping sector has done little to financially incentivise the uptake of marine biodiesel blends this year. On the other hand, voluntary demand for marine biodiesel blends has been steady from shipowners seeking to deliver proof of sustainability (PoS) documentation to their customers to offset the latter's scope 3 emissions. But this may have shifted geographically in recent months in favour of Singapore over ARA. Soft fundamentals in the marine biodiesel blend market has been compounded by pressure on prices in underlying crude and biodiesel markets. The front-month Ice Brent crude futures and gasoil futures contracts hit a near three-year low at 16:30 BST on 10 September. This in turn weighed on values of very-low sulphur fuel oil (VLSFO) and marine gasoil (MGO), and the former makes up 70pc of the B30 Advanced Fame dob ARA blend. VLSFO dob ARA prices have averaged $505.58/t so far in September, compared with $533.38/t on 1-18 August, having hit $483/t on 10 September, the lowest level since August 2021. Meanwhile, in the underlying biodiesel market, Advanced Fame 0 fob ARA prices were at the second-lowest level on record on 17 September, with the price marked at parity to used cooking oil methyl ester (Ucome) for the first time. Several market participants have said that low prices for German greenhouse gas (GHG) quota tickets, which can be traded on the market to meet the country's emissions reduction mandate, have discouraged buyers from physically blending advanced biodiesel, as tickets are a cheaper option. The current year GHG other ticket price hit a new historic low of $85/t CO2 equivalent (CO2e) on 13 September, down by $115/t compared with the same time last year and by $378/t compared with two years ago. Provisional EU anti-dumping duties on Chinese-origin biodiesel that came into force on 16 August have also turned European buyers away from advanced product made in China, which used to be one of the main sources of advanced biodiesel in Europe. By Hussein Al-Khalisy and Simone Burgin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Latest alternative marine fuels news

East-west marine biodiesel spread near six-month low


06/09/24
Latest alternative marine fuels news
06/09/24

East-west marine biodiesel spread near six-month low

London, 6 September (Argus) — The east-west marine biodiesel spread narrowed amid firm demand for the B24 blend in Singapore and lacklustre spot marine biodiesel demand in northwest Europe in recent sessions. The east-west marine biodiesel spread — the premium held by B30 used cooking oil methyl ester (Ucome) dob ARA to B24 Ucome dob Singapore — was marked at $47.50/t on 5 September, its narrowest since 19 March. The spread narrowed amid a noted increase in demand from Asian-based shipowners who embark on voyages to Europe ahead of the implementation of FuelEU Maritime regulations in Europe next year — according to market participants. The latter had also reported an increase in B24 demand in Singapore from containerships seeking scope 3 emissions rights that can then be passed on to cargo owners. Scope 3 emissions rights can be obtained on a mass-balance system, allowing shipowners flexibility with regards to the port at which a blend can be bunkered. Argus assessed B24 dob Singapore prices at an average of $720.70/t on 1 July–5 September this year, compared with $757.70/t on 8 February–28 June following the launch of the B30 Ucome dob ARA price on 8 February. Consequently, the east-west marine biodiesel spread was marked at an average of $95.34/t on 1 July–5 September, compared with $74.57/t on 8 February–28 June. A wider east-west spread would incentivise shipowners to opt for the B24 blend in Singapore rather than ARA, when operationally viable, to meet the voluntary scope 3 demand from their customers. Rising demand in the Singapore bunkering hub was further supplemented by higher sales of marine biodiesel blends at the port. According to official data released by the Maritime and Port Authority of Singapore, sales of marine biodiesel blends in the second quarter of the year were marked at about 161,400t — higher by 34,500t from the previous quarter. This was also higher by 52,600t from the second quarter of last year. By Hussein Al-Khalisy Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Latest alternative marine fuels news

Gold Standard releases two new shipping methodologies


04/09/24
Latest alternative marine fuels news
04/09/24

Gold Standard releases two new shipping methodologies

London, 4 September (Argus) — Carbon registry Gold Standard has launched its Methodology for Reducing Methane Emissions from Combustion Engine Exhaust and its Methodology for Marine Fuels and Bio Bunkers, aimed at reducing the environmental impact of shipping operations. The two new methodologies will add to Gold Standard's existing Retrofit Energy Efficiency Measures in Shipping methodology and Methodology for Emission Reduction by Shore-side or Offshore Electricity Supply System. The Methodology for Marine Fuels and Bio Bunkers was developed by biofuels trading firm Alcom, and will serve as a guideline for obtaining carbon credits from the use of marine biodiesel blends. The methodology currently only applies to marine biodiesel blends comprising used cooking oil methyl ester (Ucome), with a scope covering biofuel production to be used within the maritime industry across all sea vessel types and covering the entire chain of emissions on a well-to-wake basis. Only the biofuel component that has been loaded on to the vessel and blended with fossil fuels can be eligible for carbon credits under this methodology. Gold Standard's Methodology for Reducing Methane Emissions from Combustion Engine Exhaust was developed in partnership with consulting group Fremco and technology company Daphne Technology. The methodology aims to reduce methane emissions stemming from maritime and stationary land-based internal combustion engines that utilise natural gas or other methane-rich fuels. It will also mandate real-time measurements before and after the abatement system to ensure "robust monitoring of emission reductions". By Hussein Al-Khalisy Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Latest alternative marine fuels news

Houston-ARA B30 diff could spark Houston interest


09/08/24
Latest alternative marine fuels news
09/08/24

Houston-ARA B30 diff could spark Houston interest

New York, 9 August (Argus) — The Houston to Amsterdam-Rotterdam-Antwerp (ARA) B30 biodiesel for bunkering price differential is narrow enough to generate buying interest in Houston, as environmental regulations tighten in 2025. B30 biodiesel blends, comprised of 30pc cooking oil methyl ester (Ucome) and 70pc very low-sulphur fuel oil (VLSFO), allow ship operators to lower their greenhouse gas (GHG) emissions and thus lower their CO2 expenses. In May and June, Houston B30 was assessed at a $7-$17/t discount to ARA B30 (see chart). In July, the differential flipped to a $22/t premium, as the US Gulf Ucome price gains outpaced northwest Europe's. But provided that the differential remains narrow, US Gulf coast B30 demand from ocean-going vessels could pick up next year, as EU-led GHG regulations tighten, a trader told Argus . EU's emissions trading system (ETS) for marine shipping commenced this year and requires that each ship operator pay for 40pc of the GHG generated on 50pc of each voyage starting or ending in the EU. This applies to vessels travelling between the US and EU. In 2025, the EU ETS emissions limit will increase from 40pc to 70pc, and jump up to 100pc in 2026. Starting next year, the EU's FuelEU Maritime regulation will require a 2pc cut in GHG intensity for bunker fuels compared with 2020 base year levels. FuelEU imposes a penalty of €2,400/t ($2,622/t) VLFSO energy equivalent. Similar to the EU ETS, the FuelEU regulation applies to 50pc of the fuel used on voyages between the US and EU. In addition to tightening EU-led regulations, US biodiesel for bunkering demand could be boosted if the US allows for subsidies for biodiesel sold to ocean-going vessels. Currently, ocean-going ship operators cannot take advantage of the same subsidies that are given to biodiesel blended for use for US road transportation. In February, a bipartisan "Renewable Fuel for Ocean-Going Vessels Act", was introduced in the US Senate, a companion to a prior bill introduced in the US House of Representatives in October 2023 . The bills have not progressed to the Senate or the House. If they pass, Houston B30 biodiesel for bunkering would become more price competitive than ARA B30. By Stefka Wechsler B30 biodiesel (Ucome + VLSFO) $/t Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Webinars

Impact of EU ETS in 2024 and IMO’s emissions strategy

From 2024, ship owners will be required to pay for 40pc of their CO2 emissions under the EU Emission Trading Scheme (EU ETS) when operating in EU territorial waters. Meanwhile, the IMO has revised its greenhouse gas (GHG) emissions strategy. How will these regulatory developments impact fuel choices for the maritime sector? This webinar will provide a price comparison of alternative and conventional marine fuels and discuss the most feasible options.

Insight papers

Marine biodiesel demand to rise

As marine gasoil supply tightens and shipowners seek more sustainable options, marine biodiesel, a blend of Advanced Fame 0 and very low sulphur fuel oil (VLSFO), could provide a reasonably competitive, low sulphur and low carbon alternative. This white paper examines dynamics including demand and pricing for the fuel.

Webinars

Alternative marine fuel price competitiveness to 2025

Dive into the forecast for the marine fuels markets with this complimentary webinar from our consultant behind Argus Marine Fuels Outlook, Elena Domashenko.

FAQs

B24 (Ucome & VLSFO) dob Fujairah

Argus has launched the first marine biodiesel price for the Middle East — B24 dob Fujairah — adding to its existing coverage for Asia, with prices also published at the ports of Singapore and Guangzhou. B24 dob Fujairah is calculated as a netforward by adding the daily freight rate to the B24 dob Singapore daily spot price. The B24 dob Singapore spot price assessment includes blends of 24pc used cooking oil methyl ester (Ucome) and 76pc very-low sulphur fuel oil (VLSFO)

FAQs

Argus B30 (Ucome and VLSFO) dob Houston, Los Angeles

B30 Houston and Los Angeles delivered on board (dob) prices for use by ocean-going vessels comprise 30pc used cooking oil methyl ester (Ucome) and 70pc very low-sulphur fuel oil (VLSFO). These calculated prices provide the market with a reference for a waste-based marine biodiesel blend in North America.

Argus marine fuel database sample extracts alternative fuels

Alternative fuels vessels and supplier list

Argus lists vessels that are burning alternative marine fuels, including methanol, biofuels, ammonia, hydrogen, LNG, LPG, as well as those running on batteries. The database is updated every month.

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Argus marine fuel database sample extracts scrubbers

Scrubbers

Argus’ scrubber database is the only database to provide granular vessels details such as vessel name, owner, IMO number, deadweight, etc.

The database is updated every month. It contains over 4,300 records and counting.

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With deep expertise in the markets for future marine fuels, Argus can provide detailed insight for the marine industry as it transitions towards decarbonisation. Here are some of our related services: