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Bunker Fuel

Argus Media viewpoint: HSFO to face continued strain

Supply pressures will continue to elevate European fuel oil prices in 2024 while bunkering hubs outside Europe might grow in prominence; market is predicting lower demand for bunker fuels in Europe in 2024.
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Supply pressures will continue to elevate European fuel oil prices in 2024, with relief coming from hitherto less significant exporters a possibility, while bunkering hubs outside Europe might grow in prominence.

18 December 2023

EU states pivoted away from Russia for their high-sulphur fuel oil (HSFO) imports after sanctions started in 2023. Vortexa data show that after 5 February, half of HSFO departures signalling for European ports — excluding those in Turkey — came from the UAE, Saudi Arabia and Iraq. In contrast, across all of 2022, Russia accounted for nearly 80pc of seaborne HSFO deliveries.

Relying on these middle Eastern countries for HSFO and crude oil supplies in 2024 will probably tighten supplies over the summer, as was the case in 2023, when HSFO discounts to Ice Brent crude futures flipped to a premium for the first time in 30 years.

Further establishing flows between newer exporters will be important to European buyers and refiners in 2024. Venezuela, whose oil industry was sanctioned by the US until October, has been touted as a potential supplier of sour crude and fuel oil to the west in the coming months, which could provide some relief to HSFO undersupply in northwest Europe. Likewise, Venezuelan volumes going to the 

Mediterranean may incentivise transportation of the product within the region, where HSFO paucity has at times disincentivised refiners from paying rising freight costs to move smaller than desired cargoes.

HSFO demand from non-European countries such as China may also draw the attention of large exporters of sour crude and feedstocks. China recently released a new set of import quotas for foreign HSFO after independent refiners reached their crude import limit.

Demand for imported fuel oil from the Chinese refining sector has approached historic highs this year. But some refinery sources in China reckon the government’s tax rebate policy will be adjusted to reduce these flows.

Eastern promises

The market is predicting lower demand for marine fuels, largely consisting of very-low sulphur fuel oil (VLSFO), in Europe across 2024, partly because of the marine sector preparing for its greenhouse gas emissions to be incorporated in the EU’s emissions trading scheme (ETS).

From January, the ETS will cover CO2 emitted from all large vessels entering EU ports, with shipping companies in 2025 having to surrender emissions allowances for 40pc of those emissions. In the short run this will push vessels to bunker outside EU waters, as the transition to green marine fuels gets underway.

Bunker fuel demand has generally tapered off towards the end of 2023, leading many suppliers to shift large volumes to Singapore, the world’s main bunkering hub. Singaporean demand for bunker fuels generally rallied in the last quarter.

VLSFO stocks have also been moved east out of Europe because of the tightness of supply in Singapore in recent months, a knock-on effect of technical disruption at refineries east of Suez. Producers and suppliers in Europe are keeping a weather eye on the state-owned 615,000 b/d al-Zour refinery in 

Kuwait, a potentially huge supplier of VLSFO in the east next year. Al-Zour was hit by many technical disruptions in the latter part of 2023, at one point having to draw operations to a near complete halt. 

With a consequently reduced output of VLSFO, producers in Europe have been able to capture margins by selling to Singaporean buyers. In 2024, whether KPC can end problems at al-Zour will play a big part in determining whether the 0.5pc sulphur product continues to flow east, and whether pressure on stocks in Europe will rise or fall.

By Bob Wigin

Photo credit and source: Argus Media
Published: 19 December, 2023

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LNG Bunkering

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

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

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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

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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

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Nuclear

ABS awards AiP to Korean institute for SMR-powered container ship concept design

KRISO says AiP recognises the technical feasibility and safety of its concept design, marking an important milestone toward the development of next-generation nuclear-powered commercial ships.
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ABS awards AiP to Korean institute for SMR-powered container ship concept design

Korea Research Institute of Ships & Ocean Engineering (KRISO) on Thursday (16 July) received Approval in Principle (AiP) from the American Bureau of Shipping (ABS) for its concept design of a 15,000 TEU Small Modular Reactor (SMR)-powered container ship utilising Molten Salt Reactor (MSR) technology.

KRISO said the AiP recognises the technical feasibility and safety of its concept design, marking an important milestone toward the development of next-generation nuclear-powered commercial ships.

“This achievement demonstrates international recognition of KRISO’s technological capabilities in the rapidly evolving field of nuclear-powered shipping, supporting the transition toward low-carbon maritime transport,” it said. 

Building on this milestone, KRISO will continue advancing basic and detailed ship design, paving the way for future demonstration and commercialisation of SMR-powered vessels. 

Through continued R&D and international collaboration, KRISO remains committed to strengthening next-generation maritime technologies and contributing to the safe deployment of nuclear propulsion in the maritime industry.

 

Photo credit: Korea Research Institute of Ships & Ocean Engineering
Published: 21 July, 2026

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