Higher Singapore VLSFO bunker prices driving ships away
Shipowners are choosing to bunker in other ports in Asia besides Singapore whenever possible as very low-sulphur fuel oil (VLSFO) prices in the city-state seem comparatively higher, market sources told Argus.
VLSFO spot bunkers in Zhoushan and South Korea have been assessed at average discounts of $38/t and $36/t respectively versus Singapore over the past two weeks, according to Argus data.
Sharply lower Brent crude prices on 6 July are not expected to spur demand much in Singapore.
"Owners are not sure what to do and Singapore remains expensive," a London-based broker said.
"This huge drop just means that buyers are anticipating even larger declines," a local trader said.
Prices of VLSFO bunkers have been high for a while now on the back of tight cargo availability. The premium of VLSFO bunkers, or the price of delivered bunkers minus the cargo price, has averaged $100/t over the past month compared with typical values of $10-15/t.
Meanwhile, low demand for and surplus supplies of high-sulphur fuel oil (HSFO), together with VLSFO supply tightness in Singapore, have driven the Hi-5 or scrubber spread, the differential between VLSFO and HSFO, to record levels. The spread was assessed at an all-time high of $596.50/t on 5 July, Argus data show.
Singapore sold a total of 19.16mn t of bunkers during the first five months of this year, down from 21.15mn t over the same time last year, data from the country's Maritime and Port Authority show, signalling that the city-state is facing increasing competition from other regional ports.
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Advanced Fame marine biodiesel blends hit 9-month low
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.
USCG updates ongoing lower Mississippi restrictions
USCG updates ongoing lower Mississippi restrictions
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California regulator floats future LCFS linkage
California regulator floats future LCFS linkage
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California still eyeing 2025 start to LCFS changes
California still eyeing 2025 start to LCFS changes
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