LNG Bunkering

ENGINE Q&A: LNG bunker market set for low prices and rapid demand growth

In an interview with ENGINE, Emma Richards of BMI Research argues that a global gas supply glut will weigh down on LNG prices and create fresh bunker demand from both new and existing vessels.

Published

2 years ago

March 11, 2024

Admin

After the LNG bunker market was shook by Russia’s invasion of Ukraine and skyward prices, it now faces a period of oversupply, low prices and soon a doubling of the global LNG-fuelled fleet.

The LNG bunkering market faces an upswing which will be driven by a notable increase in LNG-fuelled vessels in operation. With 509 operational LNG-fuelled vessels reported until now, and an additional 524 on order, the industry braces itself for significant expansion. Amidst this growth, the dynamics between sellers and buyers could change.

In an interview with ENGINE, Emma Richards argues that a global gas supply glut will weigh down on LNG prices and create fresh bunker demand from both new and existing vessels. She is an associate director of oil and gas at BMI Research and has over 10 years of experience as an analyst and researcher, with LNG as one of her specialisms.

How are industry players preparing themselves to tackle the expected growth of the LNG bunkering market in the coming years?

The LNG bunkering market is set for rapid expansion over the coming years, with DNV reporting 471 LNG-fuelled vessels operational as of 2023 and another 523 currently on order and set to begin commercial operations within the next five years.

Bunkering infrastructure is already fairly well-established along most major trade routes and industry players are ramping up their spending to cope with the expected increase in demand, via investment in bunkering terminals and ship-to-ship and truck-to-ship LNG bunkering capacity.

Traditional demand centres in North America, Europe and East Asia will continue to pull the lion’s share of capex, but we’re also seeing increased spending in other regions, such as MENA.

As well as individual investments in local facilities, some players are also partnering up, to build out global bunkering networks. This entails strengthening ties across existing hubs, as well as exploring new markets to penetrate along key shipping routes.

As with investments in the LNG sector more broadly, GHG emissions levels are growing in importance and measures to reduce carbon intensity are a common feature of many new projects under development.

Will the extra natural gas production and LNG export capacity that is set to come online in the US and Qatar over the coming years lead to an LNG glut?

Yes, it looks very likely to be the case. Qatar and the US are both set for significant export growth over the next five years, but there’s a whole host of other markets that are also ramping up their exports – Mozambique, Malaysia, Russia, Nigeria, Indonesia and Australia, to name just a few.

We don’t see underlying LNG demand growth being strong enough to absorb these exports in full, so – assuming liquefaction capacity comes online as planned – we’re looking at quite a loose market balance over the mid-to-late 2020s.

Based on our forecasts, 2026 and 2027 will represent the peak of the supply glut, with imports playing catch-up from there. To be clear, we’re very bullish on demand growth, it’s just a highly cyclical industry, and recurrent periods of surplus followed by scarcity are part and parcel of that.

If so, will that also permeate down to a glut on the LNG bunkering side and pressure prices down?

Yes, changes in LNG prices feed very directly into the bunkering market and prices will need to adjust downwards, to incentivise discretionary purchases and encourage fuel switching towards LNG. Sellers have generally had the upper hand over the past few years, but it’ll be the buyers’ turn soon.

Spiraling costs in the wake of Russia’s invasion of Ukraine in 2022 definitely took their toll on the LNG bunkering sector, pressuring demand to the downside and triggering the cancellation or delay of several LNG-fuelled vessels and bunkering projects. But the combination of lower LNG prices and tightening environmental regulations in the maritime sector paint a pretty bright picture for demand going forward.

By Debarati Bhattacharjee

Source: ENGINE
Photo credit: Shaah Shahidh on Unsplash
Published: 11 March, 2024

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PIL's LNG dual-fuel boxship “Kota Elok” arrives in Singapore on maiden call

Singapore-based Pacific International Lines Pte Ltd on Monday (20 July) said its first 13,000 TEU LNG dual-fuel container vessel, Kota Elok, recently made her maiden call to Singapore on 15 July.

As the first of 13 new 13,000 TEU vessels joining its fleet, Kota Elok is equipped to operate on liquefied natural gas (LNG) and low-sulphur fuel oil that helps reduce our greenhouse gas emissions.

The vessel also incorporated energy-saving features and digital technologies to reduce fuel consumption and enhance operational performance, as well as a bow windshield to improve aerodynamics, contributing to improved fuel efficiency and lower emissions over the course of long-haul voyages.

“Following Singapore, Kota Elok will continue her voyage on our East Coast Service 1 (ES1) route to South America, calling at ports in Brazil, Uruguay, and Argentina before returning to Asia,” the company said in a social media post.

Kota Elok also became PIL’s first vessel to receive Lloyd’s Register certification for compliance with the IACS UR E26 and UR E27 cyber security requirements.

Developed by the International Association of Classification Societies (IACS), UR E26 and UR E27 are mandatory cyber resilience requirements for newbuild vessels contracted from 1 July 2024.

Photo credit: Pacific International Lines
Published: 21 July, 2026

LNG Bunkering

CIMC SOE secures order for 12,000-cbm LNG bunkering vessel from Sinopec Clean Energy

Once operational, the vessel is expected to strengthen Sinopec’s domestic coastal LNG bunkering network and help address gaps in China’s alternative fuel bunkering infrastructure.

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CIMC SOE secures order for 12,000-cbm LNG bunkering vessel from Sinopec Clean Energy

China’s Nantong CIMC Sinopacific Offshore & Engineering Co., Ltd. (CIMC SOE) recently signed a contract with Sinopec (Beijing) Clean Energy Co., Ltd. to build a 12,000-cubic metre (m3) LNG bunkering vessel, according to Chinese maritime media.

The vessel is scheduled for delivery in 2028 and will support Sinopec’s efforts to expand its presence in the marine clean energy sector.

Once operational, the vessel is expected to strengthen Sinopec’s domestic coastal LNG bunkering network and help address gaps in China’s LNG bunkering infrastructure.

With this signing , CIMC Pacific Offshore Engineering’s LNG bunkering vessel orderbook is further strengthened, maintaining its leading position in the global market for small and medium-sized LNG bunkering vessels.

The contract also marked another milestone for CIMC SOE, which has seen a sharp increase in orders and business performance this year amid a surge in domestic LNG vessel demand.

Photo credit: Nantong CIMC Sinopacific Offshore & Engineering
Published: 21 July, 2026

Alternative Fuels

ENGINE on Fuel Switch Snapshot: LSMGO surges to greater premium over biofuel

B100 discount to LSMGO widens to $541/mt in Rotterdam; Singapore’s B100 drops to $106/mt below LSMGO; Rotterdam LBM at $639-833/mt discounts to LSMGO.

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ENGINE on Fuel Switch Snapshot: LSMGO surges to greater premium over biofuel

Once a week, bunker intelligence platform ENGINE will publish a snapshot of alternative and conventional bunker fuel prices in the world’s two biggest bunkering hubs. The following is the latest snapshot:

20 July 2026

B100 discount to LSMGO widens to $541/mt in Rotterdam
Singapore’s B100 drops to $106/mt below LSMGO
Rotterdam LBM at $639-833/mt discounts to LSMGO

B100’s premium over HSFO in Rotterdam has narrowed by $50/mt over the past week to $64/mt, while its discount to VLSFO has widened by $83/mt to $105/mt.

B100 has become far more competitive against LSMGO in Rotterdam, with its discount widening by $180/mt over the past week to $541/mt, as a surge in conventional fuel prices left B100 broadly unchanged by comparison.

B100’s price has risen by $109/mt in Singapore, but its discount to LSMGO has still widened by $102/mt to $106/mt, as LSMGO surged by an even greater $211/mt.

Rotterdam’s LNG premium over VLSFO has widened by $35/mt to $201/mt for vessels with Otto medium speed (Otto MS) engines. For vessels with diesel slow speed (diesel SS) engines, LNG has flipped to a $15/mt premium over VLSFO, from a $22/mt discount the prior week.

Liquefied biomethane (LBM) discounts to VLSFO in Rotterdam have narrowed by $50-52/mt to $203-396/mt over the past week. Against LSMGO, LBM discounts have widened by $45-47/mt to $639-833/mt, depending on engine type.

In Singapore, LNG is now $42/mt cheaper than LSMGO for vessels with Otto MS engines, and $134/mt cheaper for vessels with diesel SS engines.

ENGINE on Fuel Switch Snapshot: LSMGO surges to greater premium over biofuel

Liquid fuels

HSFO and VLSFO prices in Rotterdam have jumped by $66/mt and $99/mt respectively over the past week, while LSMGO has surged by an even steeper $196/mt. A $9.69/bbl ($71/mt) rise in front-month ICE Brent futures, to $87.94/bbl ($645/mt), drove bunker prices sharply higher across the board.

Bunker fuel availability is tight for prompt delivery dates in the ARA ports, with buyers advised to enquire about stems between 5-7 days ahead to get good coverage, a trader said.

Rotterdam’s B100 price has risen by $16/mt over the past week. Dutch ZRE A ticket prices were unchanged at €107.50/mtCO2e.

Singapore’s HSFO and VLSFO prices have risen by $130/mt and $132/mt respectively, while its LSMGO price has gained an even steeper $211/mt over the past week.

VLSFO availability in Singapore has been tight, with several suppliers reporting low stock levels. Recommended lead times have widened from 13–17 days last week to 14–19 days now.

Liquid gases

Rotterdam’s LNG prices have surged by $134-136/mt over the past week, while its LBM prices have climbed by $149-151/mt.

LBM discounts to LNG in Rotterdam have narrowed by $15/mt to $404-411/mt.

Singapore’s LNG bunker benchmarks have surged by $196-197/mt over the past week.

By Erik Hoffmann

Photo credit and source: ENGINE
Published: 21 July, 2026