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Argus Media: Russian bunkering operations continue despite COVID-19 time off

13 Apr 2020

Konstantin Levchenko of the global energy and commodity price reporting agency Argus Media on Thursday (9 April) published an article regarding bunkering operations and sales at Russian ports despite COVID-19 restrictions: 

Russian bunker sales and operations were not affected by Russia declaring a national time-off period because of Covid-19 pandemic prevention efforts.

Russia’s non-working period, meant to curb the spread of the coronavirus, started on 30 March and will last through 30 April. An extension of the measures will be assessed later. The measure had no significant impact on the Russian bunker market as most bunkering companies were running normally and Russian refinery operations and product shipments were not interrupted.

Foreign buyers were seeking mostly very low-sulphur fuel oil (VLSFO). Suppliers at the two major Russian Baltic Sea ports, St Petersburg and Ust-Luga, kept their VLSFO price offers at around a $100-$120/t discount to the competing northwest European ports of Rotterdam and Antwerp in order to incentivize buying interest from foreign shipowners. The discount between ports in the Russian far east and the competing ports of Singapore and Busan, South Korea, was at $20-$60/t in late-March and early-April.

A global marine fuel sulphur regulation which started on 1 January requires that vessels with no scrubbers burn 0.5% sulphur maximum marine fuel in international waters, down from a previous 3.5% sulphur limit. The regulation allows for vessels equipped with scrubbers to continue to burn high-sulphur fuel oil (HSFO).

Spot demand HSFO for bunkering was mostly muted as scrubber-equipped vessels were infrequent at Russian ports. The operators of such vessels have to pre-order the product well ahead of arrival as most Russian bunkering companies stopped replenishing HSFO stocks in October-November 2019 ahead of the new rule. HSFO continues to be sold on a contract term basis.

Photo credit and Source:
Argus Media
Published: 13 April, 2020

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