Connect with us

Business

BIMCO: Low-sulphur fuel sale jumps as 2020 sulphur cap kicks in

Sales of low-sulphur fuels, including LSFO and MGO LS, rose by 51% month-on-month in December to 3,127 kilo mt, compared to the 1,271 kilo mt of HSFO sold in the same month.

Admin

Published

on

Singapore bunker sales bimco

[vc_row][vc_column][vc_column_text]Peter Sand, Chief Shipping Analyst at BIMCO, on Thursday (16 January) published an overview where he notes the final quarter of 2019 marking a massive decline of HSFO sales, as the industry transitioned into compliance with the IMO 2020 Sulphur Cap (IMO2020):

In Singapore, the world’s largest bunkering hub, the bunker sale landscape saw significant change as the sale of high-sulphur fuel oil dropped tremendously in a matter of months. In contrast, the sale of low-sulphur fuels skyrocketed in the final quarter.

The first wave of IMO2020

Preliminary estimates from The Maritime and Port Authority of Singapore indicates that a total of 4,465 thousand tonnes were sold in December 2019, a 4% increase compared to December 2018 and the highest sale of bunker fuel sold in Singapore since January 2018.  Sales of low-sulphur fuels, including LSFO and MGO LS, rose by 51% month-on-month in December to 3,127 thousand tonnes, compared to the 1,271 thousand tonnes of HSFO sold in the same month.

“The shipping industry has been riddled with market uncertainty in recent months, but the bunker sales in the port of Singapore provide one of the first readings as to how the industry has transitioned into compliance with the IMO2020 regulation. We have now surpassed the first wave of IMO2020 and hopefully the accompanying market uncertainty will diminish as we proceed into 2020,” said BIMCO Chief Shipping Analyst Peter Sand.

The shift in bunker sales

In December, a total of 2,630 thousand tonnes of LSFO were sold, accounting for 59% of total sales. This is a massive change considering that it accounted for roughly 1% of total sales in the last couple of years. However, total 2019 bunker sales in Singapore were down 4% year-on-year, the lowest level since 2015.

The December figures provide insight into the IMO2020 transition and how the upcoming year might unfold. At the start of 2019, low-sulphur fuels accounted for a mere 8% of total sales compared with a jump to 70% in December. The massive uptick in market share of low-sulphur fuels illustrate the first wave of IMO2020, but BIMCO does not necessarily expect the low-sulphur to high-sulphur sales ratio to remain at these levels in the coming year.

While low-sulphur fuels have gained the largest market share, it is worth noticing how HSFO still accounts for 28% of total sales, driven by bunkers purchased for scrubber-fitted ships. Many of the scrubber-fitted ships are also the largest types of ships consuming relatively more fuel, which will surely facilitate stable demand for HSFO.

The bunker market in the port of Rotterdam, approximately one sixth the size of the Singaporean market, exhibited the same trend in November. Here, the sale of HSFO declined substantially while low-sulphur fuels rose to 50% of total bunker sales.

Transitioning into the new reality

The shift in bunker sales underlines the massive transition that the shipping industry has been faced with at the turn of the decade. Whereas bunker suppliers began their IMO2020 transition in the third quarter of 2019, many shipowners waited until the last minute to transit. The late transition has seemingly allowed shipowners to benefit from the declining HSFO prices in recent months, while also burning off the remaining HSFO left in the tanks.

The price of HSFO started to spike dramatically in 2019, driven largely by geopolitics and bunker suppliers preparing for IMO2020.

The low-sulphur to high-sulphur spread widened towards record-breaking territory around the implementation deadline of IMO2020, driven by rising low-sulphur fuel prices. However, two weeks into the new year the spread has started to narrow slightly, which could indicate that the global fleet has bunkered sufficiently for the first wave of the transition, as also evidenced by the bunker sales in Singapore.

A second wave will surely set into motion once the fleet has burned through the initial supply of low-sulphur fuels. Whether the spread will follow along the same lines and widen at that point remains uncertain, but it seems likely that the spread might narrow in the coming months, as the fog of IMO2020 uncertainty clears.

VLSFO – the silver bullet for IMO2020?

An array of different compliant distillates has emerged in the market to facilitate compliance. While the IMO2020 sets out a regulatory framework for the shipping industry, it does not issue mandatory uniform requirements for the properties of distillate blends. To some degree, this contributes to the uncertainty regarding bunker incompatibility. Two different fuel blends with the same specifications are not necessarily compatible. Bunkering VLSFO from a bunker supplier in one port is not necessarily compatible with VLSFO bunkered in another.

VLSFO has been labelled as the silver bullet for the IMO2020 market. Yet, up until the fourth quarter of 2019, VLSFO was only available in a few select ports, but at an attractive price discount to MGO LS. However, In December 2019, the MGO LS and VLSFO reached price parity in Singapore, seemingly on the back of higher demand for VLSFO.

The rising cost of low-sulphur fuels illustrates the massive challenge that shipowners have been faced with overnight. At current price spreads, fuel oil costs have effectively doubled, putting heavy financial pressure on companies that must bear the cost burden themselves. The first-mover advantage associated with scrubbers seems to hold true for the time being.

“Almost from one day to another, IMO2020 has resulted in a massive increase in bunkering costs for shipowners and operators, costs which for many companies cannot be sustained for a prolonged period. Shipowners are trying to pass on the additional costs of bunkering to customers, but if the underlying supply and demand fundamentals are not balanced, their efforts may prove futile,” concluded Peter Sand.

While the industry adjusts to the new reality of IMO2020, another crucial part of the regulation is approaching hastily. On 1 March 2020, the high-sulphur fuel oil carriage ban takes effect, which prohibits ships without an exhaust gas cleaning system (scrubber) to even carry bunker fuels with sulphur content above 0.50%.

 

Photo credit and source: BIMCO
Published: 17 January, 2020[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_gallery type=”image_grid” images=”2567,2568,2569″ title=”Additional Information”][/vc_column][/vc_row]

Continue Reading

Alternative Fuels

Yang Ming orders six LNG dual-fuel, ammonia-ready containerships from Hanwha Ocean

Each of the six new vessels will have a capacity of up to 13,650 TEU and feature LNG dual-fuel propulsion and Ammonia Fuel Ready specifications.

Admin

Published

on

By

Yang Ming orders six LNG dual-fuel, ammonia-ready containerships from Hanwha Ocean

Taiwanese shipping firm Yang Ming Marine Transport Corporation (Yang Ming) and South Korean shipbuilder Hanwha Ocean on Wednesday (2 September) signed a shipbuilding contract for six 13,000 TEU class LNG dual-fuel container vessels. 

The contract was signed by Dr. Chuck Tsai, Chairman of Yang Ming, and Mr. Charles Kim, CEO of Hanwha Ocean. The vessels are scheduled for delivery between 2028 and 2029. 

They will complement Yang Ming’s existing fleet of 10,000+ TEU vessels and serve as key vessels on East-West services, with deployment flexibility across trade lanes connecting Asia with the East and West Coasts of North America, South America, and the Mediterranean. 

Each of the six new vessels will have a capacity of up to 13,650 TEU and feature LNG dual-fuel propulsion and Ammonia Fuel Ready specifications.

“As Yang Ming transitions toward net-zero emissions, LNG provides a relatively mature and economically viable alternative fuel solution, capable of reducing greenhouse gas emissions by approximately 20%,” the company said. 

“At the same time, ammonia can serve as a carbon-free fuel by utilising converted LNG storage facilities, while offering relatively lower conversion costs and comparatively well-developed supply chains and infrastructure. The Ammonia Fuel Ready design will therefore provide Yang Ming with greater flexibility in responding to increasingly stringent international regulations on greenhouse gas emissions.”

In addition, the vessels will be equipped with Type B LNG fuel tanks with a design pressure of 1.0 bar to enhance the safety and efficiency of LNG operations, together with a range of energy-saving technologies, including Wind Shields, Rudder Bulbs, Pre-Swirl Stators, and Shore Power Systems. Smart ship technologies and cybersecurity protection features will also be incorporated to enhance operational efficiency, safety, and reliability while effectively reducing fuel consumption and greenhouse gas emissions.

Deliveries under Yang Ming’s next-generation fleet optimization plan commenced earlier this year. By 2030, a total of 24 new vessels are expected to enter service. 

This includes 18 LNG dual-fuel vessels—comprising five 15,500 TEU, seven 16,000 TEU, and the six 13,000 TEU vessels under this contract—alongside six 8,000 TEU methanol dual-fuel-ready ships. 

 

Photo credit: Yang Ming Marine Transport
Published: 4 September, 2026

Continue Reading

Alternative Fuels

LR, China’s MARIC unveil tanker concept ready for three future bunker fuels

Both secured AiP for a new 114,000 DWT product and crude oil tanker designed to accommodate future conversion to LNG, methanol or ammonia.

Admin

Published

on

By

LR, China’s MARIC unveil tanker concept ready for three future bunker fuels

Lloyd’s Register (LR) and the Marine Design and Research Institute of China (MARIC) on Thursday (3 September) have secured Approval in Principle (AiP) for a new 114,000 DWT product and crude oil tanker designed to accommodate future conversion to LNG, methanol or ammonia.

Announced at SMM 2026, the concept addresses one of the biggest investment challenges facing shipping today: the need to develop vessels and capabilities that can support a range of alternative fuel options and pathways as technologies, infrastructure and regulations evolve.

While LNG is already a mature fuel pathway, methanol and ammonia remain at an earlier stage of development, with questions around global fuel availability, infrastructure development, economics and long-term adoption.

The 114,000 DWT tanker concept has been designed as a product and crude oil carrier that can accommodate future conversion to LNG, methanol or ammonia as technologies, regulations and fuel supply chains mature. By incorporating conversion readiness at the design stage, the concept aims to reduce future retrofit complexity and provide owners with greater confidence when planning long-term fleet investments.

The design concept was reviewed against LR’s July 2026 class rules and regulations, including requirements relating to ships using gases and other low-flashpoint fuels, alongside relevant IACS Common Structural Rules for oil tankers. Final classification and statutory approval remain subject to full compliance with all applicable rules and regulations.

Theo Kourmpelis, Global Business Director for Tankers, Lloyd’s Register, said: “Shipowners are being asked to make major investment decisions today despite continued uncertainty around which fuels will dominate in the decades ahead. Alternative fuel solutions each offer potential pathways to compliance, but fuel infrastructure, regulation and economics continue to evolve at different speeds around the world.

“Designs that preserve flexibility will be critical in helping owners manage risk while preparing for multiple future scenarios.”

Si Nan, Marine & Offshore Marketing Department Vice Director, MARIC, said: “As the industry explores different decarbonisation pathways, shipowners need vessel designs that can adapt alongside technological and regulatory developments. This concept was developed specifically to provide greater fuel flexibility and long-term resilience, allowing owners to respond to changing market requirements without being locked into a single fuel strategy.

“Receiving Approval in Principle from Lloyd’s Register is an important milestone that validates the design concept and supports its future development.”

 

Photo credit: Lloyd’s Register
Published: 4 September, 2026

Continue Reading

Alternative Fuels

DNV: Alternative-fuelled vessel orders hit highest monthly level since October 2024

LNG-fuelled vessels accounted for the vast majority of August activity while the strong summer performance marked a significant acceleration in ordering activity after a relatively slow start to the year.

Admin

Published

on

By

DNV: Alternative-fuelled vessel orders hit highest monthly level since October 2024

Latest data from classification society DNV’s Alternative Fuels Insight (AFI) platform alternative-fuelled vessel ordering was strong in August, with 52 new vessels added to the platform.

This is the highest monthly total since October 2024 and follows another active month in July, when 47 vessels were added to the database.

LNG-fuelled vessels accounted for the vast majority of August activity, with 46 orders recorded. The container segment led the way with 30 orders, while the car carrier segment contributed a further 12 LNG-fuelled vessels. In addition, four ethanol-fuelled bulk carriers and two hydrogen-powered bulk carriers were added during the month, as well as one LNG bunker vessel.

The strong summer performance marked a significant acceleration in ordering activity after a relatively slow start to the year. In total, 242 alternative-fuelled vessel orders have been placed in the first eight months of 2026, representing a 27% increase compared with the same period in 2025.

LNG remains the dominant fuel choice, accounting for 63% of all alternative-fuelled vessel orders registered so far this year. Container vessels represent the largest share of these LNG orders (59%), followed by car carriers (30%).

Jason Stefanatos, Global Decarbonization Director at DNV Maritime, said: “The past two months have been particularly strong for alternative-fuelled vessel ordering, with August recording the highest monthly total we’ve seen since October 2024. This has helped lift year-to-date orders to a level well above the same period last year.

“LNG remains the leading fuel choice, driven largely by activity in the container and car carrier segments. These sectors have been among the earliest adopters of alternative fuels, supported by predictable liner operations and increasing demand from cargo owners to reduce emissions across supply chains. 

“For many owners, LNG offers a combination of emissions reductions, fuel availability and future flexibility while the longer-term fuel landscape continues to evolve. 

“At the same time, the latest figures include orders for ethanol- and hydrogen-fuelled vessels, highlighting that owners continue to explore a range of decarbonization pathways. Different segments are making different fuel choices, but the overall level of activity demonstrates continued investment in lower-emission shipping.”

Screenshot 2026 09 04 at 12.29.26 PM Screenshot 2026 09 04 at 12.29.36 PM

 

Photo credit: DNV
Published: 4 September, 2026

Continue Reading
Advertisement

OUR INDUSTRY PARTNERS



Trending