• Follow Us On Our Preferred Social Media Platform:

Argus Media: HSFO bunker premiums in Singapore remain supported

12 Sep 2022

Prompt supply tightness and demand for large cargoes from vessels with scrubbers is supporting delivered premiums of high-sulphur fuel oil (HSFO) bunkers in Singapore, according to market participants.

9 September 2022

Delivered premiums — or the outright delivered bunker price over the cargo price — have averaged $23/t so far this month, only slightly below August’s average of $25/t, according to Argus data.

This is higher than market participants expected last month, on expectations of an inflow of cargoes and weak demand for the grade.

More cargoes from the west of Suez and the Mideast Gulf are headed to Singapore, but some barge operators were struggling to load ex-wharf.

“Prompt loadings especially are tight now, with offers for ex-wharf supplies even for the second half of September heard at $22/t over the cargo price,” said one local supplier.

Other reasons supporting premiums are the limited number of participants supplying HSFO bunkers in the port as well as solid demand for large cargoes, especially from container vessels.

Glencore — a large supplier of HSFO bunkers — had its bunker licence suspended by the Maritime and Port Authority (MPA) of Singapore effective from 18 August for two months, because of its involvement in supplying contaminated fuel in Singapore earlier this year.

Container vessels with scrubbers tend to buy large quantities, incentivised by a high scrubber spread. The premium of very-low sulphur fuel oil (VLSFO) bunkers over HSFO bunkers has come off from its record levels in June and July. But it has remained well above $200/t during August and so far in September, translating into large savings for shipowners with scrubbers installed.

But recent spot bunker demand across all grades in Singapore is tepid at best, as indications of weaker economic growth in China and an increasingly likely recession in Europe curtails demand from buyers, given the uncertainty clouding the economic outlook.

By Sammy Six and Sarah Giam

Related: MPA completes investigations into bunker fuel contamination; temporary suspends Glencore’s Bunkering Licence

 

Photo credit and source: Argus Media
Published: 12 September 2022

Related News

Featured News

Our Industry Partners

PR Newswire