Q&A: Bio-bunkers pivotal to low-carbon transition

Spanish Market: Oil products
07/07/25

Equatorial Marine Fuel (EMF) is a leading Singapore-based physical supplier of marine fuels. The company has an existing fleet of 21 vessels and bunkers conventional fuels as well as emerging green fuels, like B24 and B30 blends.

EMF was the largest volume supplier of marine fuels at the port in 2023, according to the Maritime and Port Authority of Singapore (MPA). The company is expanding its footprint into supplying green marine fuels and is supplying biofuel blends.

Argus' Mahua Mitra spoke with the company's chief operating officer Choong Sheen Mao about the potential and challenges lying ahead for marine biodiesel and other emerging fuels.

What is EMF's strategic position on bio-bunker fuels within Singapore's marine fuel mix?

Equatorial believes that bio-bunkers will continue to play a pivotal role in the maritime industry's transition towards low- and zero-carbon marine fuels. In the near-term, biofuels are the most price-competitive low-carbon marine fuel. In the mid- to long-term, however, it remains to be seen whether biofuels' comparative ability to scale coupled with the diversion of supply to other industries will cause biofuels to be less competitive. Equatorial is focused on the now.

Our volume and variety of biofuel bunker deliveries have increased. We have been looking at this space closely over the past few years, having obtained our International Sustainability and Carbon Certification (ISCC) in 2022 and performed our first biofuel delivery in 2023. We continue to monitor and participate in the development of other alternative marine fuels as well.

Given the regulatory requirements around biofuel delivery, what is your assessment of Type II barge availability in Singapore?

Conventional bunker tankers operating in the Port of Singapore have been allowed to carry and deliver biofuels up to B30 since 7 March 2025. While there will be more Type II barges available in Singapore, this may not have a material impact on biofuel deliveries in the near term as most deliveries are still either B24 or B30.

In any event, Equatorial has invested in four 7,999 deadweight tonne (dwt) IMO Type II chemical and oil bunker tankers capable of carrying and delivering methanol and biofuels up to B100. Two of these Type II barges have been delivered at the start of this year, and we are looking at two more to be delivered in the third or fourth quarter of 2025. Equatorial is in a position to actively participate in supplies of biofuels up to B100.

Which types of biofuel blends (e.g., B24, B30) are you seeing increased demand for in the near term? What market, regulatory, or operational factors are shaping these preferences among your clients?

The considerations regarding the use of alternative marine fuels depends on a myriad of factors including but not limited to the vessel's trading area, business model, and end-customer/consumer base. The increasing demand of B24 and B30 bio-fuel blends fluctuate between these regulatory and commercial concerns. The GHG Fuel Intensity (GFI) framework, in combination with a pricing and reward mechanism that was recently approved by the International Maritime Organisation's (IMO) Marine Environment Protection Committee (MEPC) during its 83rd session (MEPC 83) in April 2025, will be the single most significant consideration for our clients.

If formally adopted in October 2025, it will be mandatory for large ocean-going ships over 5,000 gross tonnage, which emits 85pc of the total CO2 emissions from international shipping. It would then enter into force in 2027. For vessels trading with the EU, they would already be familiar with the European Union (EU) Emissions Trading System (ETS) on carbon allowances and FuelEU Maritime penalties.

Is EMF considering entry into the LNG bunkering segment, either directly or through strategic collaboration?

Equatorial has ordered a 20,000m³ LNG bunkering vessel to be delivered in 2027. With the global demand for LNG as a marine fuel projected to increase substantially over the next few years, Singapore, the world's largest bunkering hub, is a strategic location for LNG bunkering.

The key concern is how soon existing bunkering infrastructure should be further scaled to meet the increase in demand.

When it comes to bio-blend trading, what are the most significant challenges you anticipate?

Presently, the most significant challenges are still demand and price-competitiveness. Lower oil prices would mean biofuel feedstocks are relatively expensive. These are uncertain times, nonetheless, and geopolitical development remains highly uncertain, and, as such, commodity prices highly volatile. Bunker buyers will always opt for the most economical means to comply with regulations and requirements. Equatorial continues to manage business risk by working closely with customers on their requirements and closely monitoring international affairs and markets.

By Mahua Mitra

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11/12/25

IEA ups global crude runs forecast, driven by OECD

London, 11 December (Argus) — The IEA has increased its forecast for global refinery runs for 2026, driven by a rise in OECD runs in response to strong refining economics, continuing loss of Russian supply of products and a growing global crude oil surplus. In its latest Oil Market Report (OMR), the agency increased its forecast for global crude runs in 2026 by 250,000 b/d to 84.4mn b/d. The IEA predicts crude runs in the OECD of 36.2mn b/d next year, up from 35.6mn b/d in its previous OMR. That increase means the organisation forecasts that OECD runs will drop by only 110,000 b/d on the year in 2026, despite an overall 860,000 b/d drop in OECD refining capacity in 2025-26. Strong refining margins particularly boosted European throughput in October, and the IEA expects that to continue into next year. Refinery profitability has reached the highest in recent weeks since the start of the conflict in Ukraine, caused by strong rises in crude supply and unexpected tightness in product markets, especially in middle distillates and gasoline. European throughput will reach 95pc of capacity next year, the IEA said. The IEA nudged up forecast runs in OECD Americas by 180,000 b/d to 19.2mn b/d. Higher refining margins should boost US throughput in the first half of next year, with further support found from increasing reliability in Mexican refineries. The IEA forecasts non-OECD runs at 48.2mn b/d, down from 48.5mn b/d in its previous report. Delays to the start-up of refineries in India, Iran and Angola — as well as ongoing works at KPC's al Zour refinery in Kuwait — weighed on forecast throughput. The body trimmed its forecast for Chinese runs in 2026, but said higher floating inventories of cheaper Russian and Iranian crude in Asia could cause Chinese runs and exports to rise next year. Predicted Eurasian runs held steady at 6.1mn b/d despite throughput falling to a three-year low in October. Preliminary reports suggest Russian runs recovered in November, the IEA said. Diesel supplies by pipeline for export from Russian ports could rise by 20pc on the month to 2.1mn t in December, traders said. Sanctions could provide further support to margins in 2026, the IEA said. That includes US sanctions on Russian and Iranian exports, as well as EU sanctions on products derived from Russian crude. By Josh Michalowski Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Commodity rail shippers push for more train data

11/12/25

Commodity rail shippers push for more train data

Houston, 11 December (Argus) — Industrial shippers of commodities like grain and petrochemicals want federal regulators to widen the scope of proposed rules that would require Class I railroads to report more data on their on-time service performance. US rail regulator the Surface Transportation Board (STB) in September put the industry on notice that it intends to issue rules to require that each of the six biggest railroads, including Union Pacific and Norfolk Southern, report two new categories of performance data to the agency. The first would benchmark railroads' shipments against their original estimated time of arrival (OETA) and the second would measure "industry spot and pull" data, or ISP, to determine whether shipments are picked up and delivered within their planned service window. The board action aims to address rail shippers' long-running concerns that unpredictable rail service is a wild card in their supply chains, as many shippers rely nearly completely on rail to get their goods to market. The American Fuel and Petrochemical Manufacturers (AFPM), an industry group that lobbies for US refiners and petrochemical manufacturers, applauded the STB for working to address "chronic freight rail service failures." The OETA is meant to track a carrier's targeted arrival time when it dispatches a cargo and then flag the percentage of weekly shipments that reach their destinations no later than 24 hours after an intended target, the STB said in its proposal. The AFPM, whose members include companies like Dow, Occidental Chemical and Ineos who collectively ship about 2.5mn carloads a year, said OETA data should be broken out by region, terminal, and corridor "to reveal localized bottlenecks often masked by system averages." As proposed, the STB's OETA measurement would apply to manifest train service, where trains haul an assortment of railcar types, and not to unit trains, which exclusively haul one railcar type or bulk commodity, such as coal, grain or crude. Grain shippers and the US Department of Agriculture disagreed with the STB's decision to exclude unit train shipments from the OETA measurement. The National Grain and Feed Association, whose members include Archer Daniels Midland, Bunge and other biofuels makers, said that late unit train deliveries of commodities like grain, ethanol or coal "can result in proportionally greater harm to the shipper/receiver" than smaller manifest shipments. The USDA agreed that unit train shipments should be included in the OETA measurement, and pointed out that about 75pc of US railed corn and soybean shipments in 2023 traveled in trains hauling more than 75 railcars, which would not be captured by manifest shipment data. Demand for agricultural products is highly seasonal, and missed delivery windows "can halt processing lines, disrupt export programs, and force shippers to carry excess private car inventory to buffer uncertainty," the agency said. The Association of American Railroads (AAR), which lobbies on behalf of Class I railroads, pushed back on industry requests to widen the OETA to include unit train shipments, and told the STB that several railroads do not currently generate the metrics. Adding the reporting requirements "would add regulatory burden, waste resources, and misrepresent service on the network," the AAR said. By Chris Baltimore Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

German B7 diesel premiums surge on quota rise

11/12/25

German B7 diesel premiums surge on quota rise

Hamburg, 11 December (Argus) — Traders in Germany are offering B7 diesel for January at a €10-17/100l ($11.70-19.92/100l) premium to December prices, a record high for the period, as a result of an increase in Germany's CO2 levy and greenhouse gas (GHG) quota. The offered premium is significantly higher than Argus ' estimates of €8.50/100l for B7 diesel (see chart) for the period, likely because traders have priced in some market uncertainty as they were waiting for the transposition of the EU's Renewable Energy Directive (RED III) into national law. The vote by the German federal cabinet yesterday to implement RED III should provide some clarity on the legal framework for 2026, although some grey areas remain. The GHG quota will rise to 12pc in 2026 from 10.6pc currently, requiring companies to submit more GHG certificates when selling fossil fuels. The vote confirmed market participants' expectation that advanced fuels can no longer be double-counted towards fulfilling the GHG quota. The removal of this double-counting provision could make blending biofuels more attractive and raise prices for both biofuels and GHG certificate transfers. Market participants also expect a decline in biofuel imports from Asia-Pacific, as some imports from the region are unlikely to meet the criteria to generate European GHG certificates. This is because of the planned cancellation of the 'legitimate-expectations' rule, which currently protects buyers of illegitimate GHG certificates from having them revoked. Lower Asia-Pacific volumes will affect biofuels' availability in Europe and likely support prices. Some uncertainty about the specific design of the sub-quota for renewable fuels of non-biological origin (RFNBOs), such as e-fuels and green hydrogen has also been lifted. A November draft included a penalty of around €120/GJ for non-compliance with the RFNBO sub-quota, instead of the previously proposed €70/GJ. The cabinet meeting on 10 December confirmed this higher penalty. But some traders remain uncertain on which price to use for the CO2 levy next year, with some using a CO2 price of €68/t of CO2e for their calculations — the price set for companies unsuccessful in a new CO2 auction system for the levy. The CO2 levy will transition next year from a fixed-price model, currently at €55/t of CO2e, to an auction system where the price of an emission allowance can fluctuate between €55/t and €65/t. One emission allowance corresponds to one tonne of CO2 equivalent. Companies that are unsuccessful in auctions can subsequently buy emission allowances at a fixed price of €68/t. The price could also be even higher in the secondary market for companies that do not participate in auctions. But there is some uncertainty about the auction process. The auctions will not start until next summer and the specific CO2 costs will not be fully clear until then. Some traders are so planning additional cash reserves to cover any increases in payments. This is also why some fuel suppliers are still holding back on announcing January prices because of these regulatory uncertainties, further increasing market uncertainty. But the cabinet decision yesterday could push traders to finalise their pricing for January. Reported premiums for heating oil are between €2.50/100l and €4.50/100l, which is roughly in line with Argus ' calculations. By Marcel Pott CO2 levy per 100l € Kosten pro t CO2 B0/HE B7 E5 E10 45 € 12,04 11,21 10,43 10,07 55 € 14,72 13,70 12,75 12,31 65 € 17,40 16,19 15,07 14,55 68 € 18,20 16,93 15,76 15,22 B7 with 6.8l FAME; E5 with 4.8l ethanol and E10 with 9.66l ethanol GHG compliance costs per 100l € B0 B7 E5 E10 2025 9,13 9,70 6,83 6,74 2026 16,33 14,99 11,68 10,72 Compliance with the GHG quota through blending and purchasing certificates, compliance with the RFNBO mandate through penalty Cumulative costs of GHG quota and CO₂ levy Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Supply surplus masks regional market tightness: IEA

11/12/25

Supply surplus masks regional market tightness: IEA

London, 11 December (Argus) — A large global oil surplus is masking regional tightness in crude and products markets, the IEA said today. In its final Oil Market Report (OMR) for 2025, the IEA said oil prices have only fallen modestly despite the large supply overhang because of "diverging dynamics" across crude, NGLs and products in different regions. This disconnect "notably reflects the high share of exports subject to sanctions (15pc of crude and 11pc of products), lengthening of supply routes and a tight refining system," it said. The IEA's global oil supply and demand balances imply a 3mn b/d supply surplus in the fourth quarter of 2025, and more than 3.8mn b/d in 2026. While oil on water has been rising and inventories building in China — global observed inventories rose by 1.4mn b/d in October, to a four-year high, and preliminary data show a further increase in November — there has been a notable absence of stock builds in key Atlantic basin pricing hubs, the IEA said, which is supporting prices and keeping crude futures in backwardation. In products markets, refinery outages and a coming EU ban on imports of products derived from Russia crude has led to three-year high refining margins in November, the IEA said. This trend could continue in 2026 given "limited spare refining capacity outside of China." The IEA said NGLs are increasingly comprising a large share of the overall liquids supply surplus, limiting the overhang's effect on crude prices. The IEA upgraded its 2025 consumption growth forecast by 50,000 b/d to 830,000 b/d, based on an improving macroeconomic outlook and subsiding anxieties about trade tariffs. This would bring overall demand in 2025 to 103.92mn b/d. The IEA's first oil demand growth forecast for 2025, made in April 2024, had consumption growing by 1.15mn b/d. The IEA also upgraded its 2026 demand growth forecast by 90,000 b/d to 860,000 b/d, which would bring total demand to 104.79mn b/d. The IEA lowered its supply growth projection for 2025 by 100,000 b/d to 3.05mn b/d and for 2026 by 30,000 b/d to 2.45mn b/d. These were mainly because of disruptions to supplies in sanctioned countries such as Russia and Venezuela, the IEA said. This leaves supply forecast at 106.18mn b/d in 2025 and 108.63mn bd in 2026. The IEA said Russia's crude output fell by 210,000 b/d in November to 9mn b/d, which is 500,000 b/d below its Opec+ target for the month. Russia's oil exports fell by about 400,000 b/d in November to 6.9mn b/d, "as buyers assessed the implications and risks associated with more stringent sanctions." Venezuela's crude output fell by 150,000 b/d to 860,000 b/d "as sanctions and rising geopolitical tensions with the US limited the country's ability to market its oil," the IEA said. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

N Zealand's gas output falls for 8th quarter in Jul-Sep

11/12/25

N Zealand's gas output falls for 8th quarter in Jul-Sep

Sydney, 11 December (Argus) — New Zealand's July-September gas production fell on the year for the eighth consecutive quarter, diverging from industrial gas demand, while gasoline imports rose and crude production dropped, data from the country's business, innovation and employment ministry (MBIE) show. Net gas production fell by 16pc on the year to 25.5PJ (681mn m³) in July-September, down from 30.2PJ a year earlier, data from the MBIE's New Zealand Energy Quarterly show. The country's gas stocks also fell by 2.4PJ over the same period, indicating a drawdown of inventories. New Zealand's conservative government also launched a procurement process for an LNG import terminal in October. Industrial users consumed 10.3PJ of gas over the quarter, up by 14pc on the year, largely because of the restart of Canadian methanol producer Methanex's 1.72mn t/yr Motunui plant. Methanex idled its plant in August–October 2024 and May–early July 2025 to support gas-fired power generation. The site has operated normally since then. New Zealand's gas-fired electricity generation fell in July-September. Utilities burned 7PJ over the quarter, down from 9.2PJ a year earlier, because of strong renewable generation. The country's hydroelectric and geothermal generation rose by 23pc and 6.5pc on the year, respectively. New Zealand's gasoline imports rose by 7.4pc on the year in July-September (see table). New Zealand also restarted oil and gas exploration in September , and extended permits for the 5,600 b/d Maari oil field for a decade in August. By Avinash Govind New Zealand energy production and imports b/d Jul-Sep '25 Apr-Jun '25 Jul-Sep '24 q-o-q ± % y-o-y ± % Gasoline imports 49,972 50,531 46,516 -1.1 7.4 Diesel imports 65,093 67,306 61,411 -3.3 6 Jet fuel imports 28,406 28,923 28,884 -1.8 -1.7 Natural Gas Liquids (NGL) 15,056 13,954 15,687 7.9 -4 Gas production (PJ) 26 26 30 -0.9 -16 Source: New Zealand's Ministry of Business, Innnovation and Employement Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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