Bunker quality disputes rare but global issue: Law firm
Problems with off-specification bunker fuel have been relatively rare this year, but have been seen at all the world's major ports, and any disputes have mostly been resolved without court action, a bunker conference heard today.
Speaking at the Aracon 2020 virtual conference, law firm Hill & Dickinson partner Beth Bradley said that legal action has been uncommon, and has not occurred more often in any one region. At the turn of 2020, when the International Maritime Organisation (IMO) 0.5pc sulphur cap came into force, there were concerns over the quality of new, compliant blends. There have been some issues, but not as much as had been feared.
Bradley said that the majority of problems with 0.5pc sulphur fuel oil have arisen over sediment or sulphur content, and most disputes are resolved commercially.
"It seems to be, particularly with sediment issues, that it comes from all of the major ports. It is not as simple as being able to say the problem is in Singapore or Houston or Rotterdam. There have been problems from all over the world, not in huge volumes, and it has been pretty spread out," Bradley said. "And it is the same with sulphur content. There does not seem to be a pattern emerging."
Also speaking at Aracon, fuel testing firm Fobas' product manager Muhammad Usman said just under 4pc of 0.5pc fuel oil samples it tested were off-specification so far this year, with January the worst month at over 5pc. Testing firm Bureau Veritas' global business development manager Gunnar Kjeldsen said that 6.5pc of the 0.5pc fuel oil samples it tested in the Amsterdam-Rotterdam-Antwerp (ARA) hub were off-spec.
Usman and Kjeldsen said around half of off-spec 0.5pc fuel oil samples were down to high sedimentation levels, with elevated sulphur making up a significant chunk. Kjeldsen said there was a wide monthly variance in off-spec 0.5pc fuel oil samples this year, and that October was the lowest month with just 2pc off-spec.
Shipping association Bimco warned earlier in the year that more than half of respondents to a survey had received testing results showing 0.5pc fuel oil fell foul of regulations.
Related news posts
TUI Cruises receives methanol-ready ship
TUI Cruises receives methanol-ready ship
New York, 18 April (Argus) — Cruise ship company TUI Cruises took delivery of a methanol-ready cruise ship which will start operations at the end of June. Methanol-ready vessels allow ship owners to easily retrofit their vessels to burning methanol in the future. The 7,900t deadweight Mein Schiff 7 will operate in the North Sea, the Baltic Sea, along the European Atlantic coast and in the Mediterranean and run on marine gasoil (MGO). It was built by Finland's Meyer Turku shipyard. In January, TUI Cruises signed a memorandum of understanding with trading company Mabanaft for future supply of green methanol. Mabanaft would cover TUI's methanol needs in northern Germany, and gradually add other European locations. Grey methanol was pegged at $717/t MGO equivalent and biomethanol at $2,279/t MGOe average from 1-18 April in Amsterdam-Rotterdam-Antwerp. About 0.9 times and 2.9 times, respectively, the price of MGO, Argus assessments showed. TUI Cruises is a joint venture between the German tourism company TUI AG and US-based cruise ship company Royal Caribbean. By Stefka Wechsler Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
UAE air traffic recovery begins after storm disruptions
UAE air traffic recovery begins after storm disruptions
Singapore, 18 April (Argus) — Air traffic at Dubai International (DXB) has begun to recover after an unprecedented storm hit the country on 16 April, although flight delays are expected to continue. "DXB resumed inbound flights of international airlines operating out of terminal 1", a spokesperson for DXB operator Dubai Airports said on 18 April. But it urged travellers not to come to the terminal for outbound flights before confirming their flight status, as it said the access to the terminal is "strictly limited" to guests with confirmed departures. Prolonged flight disruptions at DXB, which was ranked the second-busiest airport in the world in 2023, according to the Airports Council International's preliminary ranking, could affect regional jet fuel demand. Dubai low-cost carrier flydubai said it has now resumed partial operations from DXB, having previously cancelled all of its flights scheduled to depart from Dubai on 16 April evening until 10am on 17 April. Select outbound flights were to operate from DXB's terminal 2 with scheduled operations resuming after 8pm on 17 April, it said, while flights from terminal 3 were due to resume after midnight. But Dubai-owned Emirates Airlines has extended the suspension on check-in for passengers departing DXB until 9am on 18 April, after having initially suspending it between 8am and midnight on 17 April. The airline said the extension was because of "continued operational challenges caused by bad weather and road conditions". Neighbouring Abu Dhabi's Zayed international airport said it is "operating smoothly", despite issuing a warning on 17 April that some flights might be delayed. By Ieva Paldaviciute Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
June deadline set for Citgo auction bids
June deadline set for Citgo auction bids
Houston, 17 April (Argus) — Bidders for Citgo's US refining assets have until 11 June to submit offers for the company's 805,000 b/d of refining capacity and associated assets, with a tentative sale hearing set for 15 July. Documents filed Tuesday in the US District Court for the District of Delaware set 11 June as the deadline for interested parties to submit final binding bids after non-binding bids were received 22 January. The court began the auction process for Citgo's parent PdV Holding (PdVH) in October, part of the process of satisfying debts owed by Venezuelan-state owned oil company PdV. The court will file a notice of a successful bid "as soon as reasonably practicable" following the 11 June deadline and selection of a successful bidder. No date has been set for the filing of objections to the sale or replies to the objections before the tentative 15 July hearing. The legal wrangling over Citgo is unlikely to conclude even if the Delaware court successfully executes the sale as 27 businesses have filed claims against Citgo amounting to more than $21bn. The scale of Citgo's operations in the US are also a challenge to any potential buyer. Few companies look ready to buy the company's three refineries, three lubricants plants and retail and midstream assets. The assets have been valued by various analysts anywhere between $6.5bn and $40bn, with a lofty valuation potentially deterring bidders. But the auction process itself has been the main cause for concern. Independent refiner PBF Energy's chief executive Matthew Lucey previously called the auction a "quagmire" , considering its ties to a complex geopolitical situation in Venezuela, saying he did not expect the sale to go anywhere in the near term. Marathon Petroleum expressed similar disdain. "We're not interested in the auction process," Marathon chief executive Michael Hennigan said on an earnings call in October . By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Idemitsu books rare US Gulf-Vancouver HVO cargo
Idemitsu books rare US Gulf-Vancouver HVO cargo
New York, 17 April (Argus) — Japanese oil company Idemitsu provisionally hired a medium range (MR) tanker to carry hydrotreated vegetable oil (HVO) from the US Gulf coast to Vancouver on 16 April, a sign of the growing HVO trade from the region into west coast North America. Idemitsu put the Stolt Sisto MR on subjects for a US Gulf coast-Vancouver voyage from 20-25 April at $2.35mn lumpsum. The fixture may be part of an agreement under which Vertex Energy supplies Idemitsu's California-based subsidiary, Idemitsu Apollo, with all of its renewable diesel production from its plant in Mobile, Alabama. The plant's exports are targeting "growing regional markets in the western United States and Canada", according to Vertex. High freight costs for US domestic shipments because of the Jones Act may be encouraging Idemitsu to focus on the Canadian market. In comparison, freight for a US-flagged MR on a New Orleans-Los Angeles voyage was equivalent to $4.34mn, nearly double the cost of a voyage to more distant Vancouver. "I think [demand from Vancouver] will keep expanding with the subsidies/grants," a shipbroker said. "There is not much production in Vancouver, just Parkland [refinery]." Canadian oil company Suncor typically books one MR vessel a month to carry HVO from the US Gulf coast to Vancouver, with two charters in October 2023 standing out as a particularly active month for the trade, according to ship fixtures compiled by Argus . But Idemitsu has been "jumping in on the action" in recent months, according to the shipbroker, provisionally hiring at least one MR tanker on the spot market in January and February before yesterday's deal. Vancouver buyers are also getting HVO from Asia-Pacific suppliers, and countries like South Korea could become increasingly competitive in the renewable trade overall as they ramp up their sustainable aviation fuel (SAF) and HVO production in the coming years. Vancouver imported around 29,500 b/d of HVO in January 2024, including 16,612 b/d from the US, 7,548 b/d from South Korea, and 5,351 b/d from Taiwan, according to Kpler data. By Ross Griffith Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more