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Argus Media: MGO to gain from Med’s tighter sulphur shipping rules

New sulphur shipping rules in the Mediterranean next year will test the region’s ability to supply the necessary bunker fuels, writes Bob Wigin

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New sulphur shipping rules in the Mediterranean next year will test the region’s ability to supply the necessary bunker fuels, writes Bob Wigin

Marine gasoil (MGO) could be the big winner in demand terms next year when new International Maritime Organization (IMO) rules on the sulphur content of bunker fuels are introduced in the Mediterranean.

From 1 May 2025, the Mediterranean will become a new IMO emissions control area (ECA), where vessels will need to adhere to a 0.1pc sulphur bunker fuel limit, down from 0.5pc at present. That will create new demand for compliant fuels such as MGO and ultra-low sulphur fuel oil (ULSFO), but the relative lack of ULSFO production from Mediterranean refineries and the region’s ready spot MGO supply mean that the latter looks set to become the most popular option among shippers, at least to begin with.

Mediterranean refiners as yet produce little ULSFO, but may be motivated to step up output next year if substantial spot demand develops. Vessels making regular journeys along the same route, typically container ships, are likely to set up term ULSFO contracts with suppliers, market sources say, but shippers looking for prompt spot volumes will initially need to look at MGO, which is already consistently available on a spot basis at most Mediterranean ports.

Speaking at this week’s Argus European Crude Conference in London, Spanish firm Repsol Trading’s head of market intelligence, Carmen Lopez-Contreras, said she has no doubt that sufficient 0.1pc sulphur marine fuels will be available for vessels once the new regulation kicks in. Repsol is already supplying ULSFO to some cruise ship and ferry operators, she said.

But the change will certainly put the region’s supply capability to the test. A study carried out in 2021 by the Regional Marine Pollution Emergency Response Centre for the Mediterranean Sea (Rempec) projected that 16.7mn t of MGO would have been burned in the Mediterranean in 2020 had it been an ECA zone then, compared with a 2016 baseline of 542,000t.

Split shift

Some market participants have also suggested that European refiners’ crude feedstock mix may not be well suited to ramping up ULSFO output, but trade data show this is less the case than in the past. Europe as a whole now takes a lot less medium sour Russian Urals crude and a lot more US light sweet WTI than it did three years ago, while, even in the Mediterranean, the sweet-sour split this year has been roughly 50:50, Vortexa data indicate, reflecting Opec output cuts and the impact of Red Sea shipping disruptions.

The Rempec study also projected high and low-sulphur fuel oil use in the Mediterranean would shrink from 15mn t in 2016 to 95,000t in 2020 under an ECA scenario. The biggest threat will be to 0.5pc very-low sulphur fuel oil, unwanted volumes of which could end up heading to markets east of Suez, traders suggest, as east-west price spreads widen.

But the outlook is slightly more complex for 3.5pc high-sulphur fuel oil (HSFO), which has been a surprising beneficiary of the IMO’s tighter sulphur rules globally, as many vessels, especially container ships, have opted to comply by installing exhaust gas cleaning “scrubbers”. This has allowed them to carry on buying HSFO, rather than switching to cleaner — and usually more expensive — alternatives.

In the Mediterranean, market participants note it would not make economic sense for many operators to fit scrubbers, as a large portion of the region’s fleet is reaching the end of its life cycle. Scrubbers may struggle to clean exhaust gases from 3.5pc sulphur HSFO to a 0.1pc level. Some Mediterranean bunker suppliers say they are already receiving requests for non-standard 2.5pc sulphur fuel oil, which exerts less wear-and-tear on scrubbers.

 

Photo credit and source: Argus Media
Published: 27 November, 2024 

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Bunker Fuel Availability

ENGINE: Americas Bunker Fuel Availability Outlook (3 July 2025)

Hurricane season disrupts bunkering in GOLA; HSFO availability improves in Balboa; first vessel berthed at new Bahia Blanca terminal.

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RESIZED ENGINE Americas

The following article regarding bunker fuel availability in the Americas region has been provided by online marine fuel procurement platform ENGINE for post on Singapore bunkering publication Manifold Times:

  • Hurricane season disrupts bunkering in GOLA
  • HSFO availability improves in Balboa
  • First vessel berthed at new Bahia Blanca terminal

North America

Bunker fuel demand has seen a slight uptick in Houston, and recommended lead times for VLSFO and HSFO stand at 5-7 days.

LSMGO is more readily available and can be delivered within five days, a source said.

The hurricane season has begun in the US Gulf and will run through November.

Its onset has resulted in tropical depressions and storms, causing intermittent disruptions to bunker operations, especially around Bolivar Roads and the Galveston Offshore Lightering Area (GOLA) on the east coast.

In GOLA, bunker deliveries are being managed on a first-come, first-serve basis and remain subject to weather conditions.

Peninsula announced last month the expansion of its physical bunkering operations in GOLA. It will offer all main conventional grades – HSFO, VLSFO and LSMGO – along with biofuels.

Also, Coastal Bend LNG has plans to develop a 22.5 million mt/year LNG export facility on the Texas Gulf Coast. The facility will include up to five liquefaction trains of 4.5 million mt/year capacity each, LNG storage tanks and bunkering infrastructure.

Bunker demand in New York has remained static compared to the previous week, with spot premiums also seeing minimal movement so far, a source noted.

In terms of availability, the port is well stocked and can make prompt deliveries of VLSFO and LSMGO with lead times of 3-4 days.

HSFO requires longer lead times of around 5-7 days.

New York may also see high wind gusts between 3–6 July, potentially disrupting operations. While no backlog is reported, anchorage deliveries could be delayed due to limited barge availability.

Bunker demand is steady in Los Angeles and Long Beach. Fuel availability is good at both ports, and suppliers continue to recommend lead times of up to seven days.

The port of Los Angeles is seeing an increase in container volumes, one week ahead of the expiration of the reciprocal tariff pause for most countries—except China, where the deadline is about a month away.

According to the Port of Los Angeles, import volumes are projected to decline in the week of 6–12 July, with 108,557 TEU expected, a drop of 18.55% from the current week.

This comes after a strong performance during the week of 29 June–5 July, when volumes are estimated to reach 133,272 TEU, up 0.73% from the previous week and 17.25% higher than the same week last year.

The number of scheduled vessels is also set to fall from 26 this week to 21 next week, the port noted.

After 9 July, high import duties could come back into effect unless the US government delays or changes them. So far, the White House has left the door open to either raising, lowering, or postponing tariffs and has not confirmed its decision.

Montreal is expected to face disruptions from 3–6 July due to high wind gusts.

Barge operations are limited to daylight hours, which could lead to congestion. Delays are possible for anchorage deliveries due to bunker barge readiness issues.

Latin America and the Caribbean

Bunker fuel availability is good in Panama. In both Balboa and Cristobal, availability remains steady across all fuel grades, with recommended lead times of roughly four days.

HSFO availability has improved in Balboa after a recent resupply of the grade, a source said.

Balboa is forecast to experience thunderstorms from 3–6 July, which could impact operations.

Deliveries at the port are currently being carried out on a first-come, first-serve basis, with priority given to vessels with confirmed transit schedules through the Panama Canal. No bunker barge congestion is noted.

In Argentina’s Bahia Blanca port, calling costs have increased from 1 July, Antares Ship Agents informed.

The first vessel berthed at the new Oiltanking berth in the port last Saturday. The vessel SEAWAYS EAGLE berthed with the help of four tugs and lifted about 70,000 cbm of Medanito crude oil.

In Zona Comun, “availability and demand both appear to be normal,” a local supplier said. Lead times for VLSFO currently stand between 5-6 days.

The anchorage may be impacted by high wind gusts on 5 July.

Deliveries are done on a first-come, first-serve basis, and bunker operations could face delays if wind gusts exceed 20 knots.

Fuel availability is decent across Brazilian ports. Both VLSFO and LSMGO grades are available at Rio Grande and Rio De Janeiro, with recommended lead times of 3-4 days.

Port of Santos is facing congestion where wait times are higher and requires over five days for delivery, a source said.

Bunker fuel availability is good at key Colombian ports.

“VLSFO for $540/mt and LSMGO for $640/mt available at Santa Marta, Cartagena and Barranquilla with lead time of 3 days,” a bunker trader informed.

By Gautamee Hazarika

 

Photo credit and source: ENGINE
Published: 4 July, 2025

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Bunker Fuel

Baltic Exchange: Bunker Report (3 July 2025)

Bunker report panellists include Island Oil Limited, Cockett Marine Oil Pte, Monjasa A/S and KPI OceanConnect, NSI Marine and Transparensea Fuels.

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Baltic Exchange: Bunker Report (3 July 2025)

The following bunker report has been provided by freight market information provider Baltic Exchange for post on Singapore bunkering publication Manifold Times:

Note:

All values are in US$/metric ton, all-in (invoice price), delivered on board
Delivery in 7-10 days
ISO 8217:2010
IFO 380 3.5% Sulphur
IFO 380 0.5% Sulphur
DMA 0.1% Sulphur

Fujairah – Offshore Anchorage Area
Gibraltar – Anchorage area
Houston – Houston Harbor
Panama – (Pacific) dangerous cargo area, Balboa
Rotterdam – Waalhaven – Maasvlakte range
Singapore – Anchorage, under SBA Scheme
Zhoushan – Southern anchorage area

Submitted weekly at Close of Business UK time Daily

Panellists:
Cockett Marine Oil Pte, Island Oil Limited, KPI OceanConnect, Monjasa A/S, NSI Marine and Transparensea Fuels

 

Photo credit and source: Baltic Exchange
Published: 4 July, 2025

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Bunker Fuel Availability

ENGINE: Europe & Africa Bunker Fuel Availability Outlook (2 July 2025)

Good prompt HSFO availability in the ARA; tight prompt VLSFO supply off Malta; prompt HSFO supply tight in Port Louis.

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RESIZED ENGINE Europe and Africa

The following article regarding Europe and Africa bunker fuel availability has been provided by online marine fuel procurement platform ENGINE for post on Singapore bunkering publication Manifold Times:

  • Good prompt HSFO availability in the ARA
  • Tight prompt VLSFO supply off Malta
  • Prompt HSFO supply tight in Port Louis

 Northwest Europe

In the ARA hub, HSFO and VLSFO lead times have come down slightly from last week to 6-8 days now, while LSMGO requires 5-6 days ahead, a trader told ENGINE.

The ARA’s independently held fuel oil stocks averaged 7% in June than in May, according to Insights Global data. At 6.67 million bbls in June, the region’s fuel oil stocks were at their lowest monthly average this year. This was also considerably lower than their five-year-average.

The region imported 102,000 b/d of fuel oil in June, a considerable dip from May’s 176,000 b/d, according to data from cargo tracker Vortexa. The UK emerged as the region’s topmost import source in June, accounting for 29% of total imports, followed by Poland (16%), the US (13%) and Lithuania (11%).

The ARA’s independent gasoil inventories – which include diesel and heating oil – fell by 6% from May to June. The ARA hub imported a total of 165,000 b/d, a considerable decrease from May’s 315,000 b/d, Vortexa data shows.

Rough weather conditions off Skaw and in Gothenburg between 2-5 May could disrupt bunkering, according to a trader.

Mediterranean

Consistent with last week, availability of fuel grades is tight in Gibraltar Strait ports, according to a trader. Lead times of 8-9 days are recommended for HSFO and LSMGO, 10-12 days for VLSFO.

Congestion has eased in Gibraltar, according to local port agent MH Bland, with four vessels awaiting bunkers on Wednesday, down from 10 vessels on Tuesday.

Suppliers in Algeciras continue to be 2-12 hours behind schedule, MH Bland said.

Similar to last week, Las Palmas has good bunker availability, with recommended lead times consistently at 5-7 days, according to a trader.

In Barcelona, all grades are readily available, with recommended lead times unchanged at 5-7 days, a trader said.

Lisbon continues to have good bunker supply, consistent with the last few weeks, and recommended lead times remain at 3-5 days, according to a trader.

Off Malta, prompt VLSFO supply is tight, according to a trader.

In the Greek port of Piraeus, HSFO and ULSFO grades are readily available, while VLSFO and LSMGO deliveries are strained, according to a trader. Possible weather-related disruptions have been forecast for the port.

Prompt supplies of all fuel grades is good in Istanbul, with recommended lead times of 1-2 days, according to a trader.

Africa

HSFO availability remains under pressure in Port Louis, according to a trader. VLSFO and LSMGO are readily available in the port. The port is also forecast to face inconsistent weather conditions in the coming days that could impact supplies, according to a source.

Durban has good bunker supply, with 2-4 days of lead time advised, consistent with the last few weeks, a trader said. LSMGO supply remains dry.

In Luanda, VLSFO and LSGMO supply is good with lead times of 3-4 days advised for both grades, according to a trader.

HSFO prompt availability is tight in Walvis Bay. Lead times of 5-7 days are recommended for VLSFO and LSMGO, which is longer than the 3-6 days recommended over the past few weeks.

HSFO is also tight in Togo’s Lome, according to a trader. Unsuitable weather conditions could result in near-term bunker delays.

By Samantha Shaji

 

Photo credit and source: ENGINE
Published: 3 July, 2025

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