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ENGINE on Fuel Switch Snapshot: Bio premiums down in Rotterdam, up in Singapore

Sharp Brent gain narrows Rotterdam bio-bunker premiums; Singapore bio premiums widen despite subdued demand.

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Fuel Switch Snapshot: Bio premiums down in Rotterdam, up in Singapore

Once a week, bunker intelligence platform ENGINE will publish a snapshot of alternative and conventional bunker fuel prices in the world’s two biggest bunkering hubs. The following is the latest snapshot: 

18 March 2024

  • Sharp Brent gain narrows Rotterdam bio-bunker premiums
  • Singapore bio premiums widen despite subdued demand

All the prices in the chart above are adjusted for their fuels' different calorific contents. This makes each of them VLSFO-equivalent, which means that the same weight of fuels in metric tonnes (mt) will theoretically allow you to sail the same distance because they contain equal amounts of energy.

Brent is sharply up on the week and has sent European oil-based bunker prices rallying. Rotterdam's VLSFO and LSMGO price gains have outpaced B24-VLSFO and B24-LSMGO gains to narrow their discounts by $4-7/mt.

The opposite is the case in Singapore, where B24-VLSFO and B24-LSMGO have moved $2-5/mt further up and away from pure VLSFO and LSMGO grades, to render bio-bunker blends less unattractive alternatives for bunker buyers.

LNG remains the cheapest bunker fuel for vessels bunkering in Rotterdam. That is the case whether you consider the outright VLSFO-equivalent LNG price only, or this price with EUA costs included.

HSFO comes in just below LNG in price in Singapore, where it is about $50/mt more expensive to bunker LNG than in Rotterdam.

VLSFO

Rotterdam’s VLSFO benchmark has gained by $17/mt in the past week, supported by a $3.26/bbl ($24/mt) jump in underlying front-month Brent futures. Singapore’s VLSFO price has been steadier and recorded a $5/mt increase in the past week.

VLSFO availability remains normal in Rotterdam. Lead times for VLSFO stems have been stable over the past week, with traders advising 4-5 days for this grade.

Prompt availability of VLSFO is tight in Singapore and traders recommend lead times of 9-13 days for the fuel grade. Demand for VLSFO has also picked up in the port, a trader said, though it is still lower than it was in January and February.

Biofuels

Rotterdam’s B24-VLSFO HBE bunker price has gained by $13/mt in the past week.

A palm oil mill effluent methyl ester (POMEME) cargo was priced at $1,301/mt in the ARA region on Friday, according to PRIMA Markets. This price has gained around $11/mt over the past week, PRIMA said. POMEME-based biofuels can qualify for advanced biofuel rebates through the Dutch HBE system.

Singapore’s B24-VLSFO UCOME bunker price has come up by $10/mt over the past week. A UCOME cargo was recorded at $1,020/mt in China’s main ports on Friday, around $20/mt higher than the previous day, PRIMA reported. As Singapore relies heavily on Chinese UCOME imports, higher Chinese UCOME prices can raise Singapore's UCOME prices.

Demand for B24-VLSFO bunker blends has slowed in Singapore, sources told ENGINE. Bio-blended bunker sales data from the Singapore port authority reflects this waning demand. Singapore sold only 16,000 mt of bio-VLSFO (mostly B24) in February, its lowest figure since August 2022. Lead times of up to seven days are generally recommended for B24-VLSFO in Singapore. But these deliveries are subject to barge availability as only a few barges carry the product, a trader added.

LNG

Rotterdam's LNG bunker price has declined by $1/mt in the past week, tracking a similar decline in the front-month NYMEX Dutch TTF Natural Gas benchmark.

Forecasts of a mild temperatures throughout Europe have combined with already subdued demand and contributed to the recent downward pressure on European natural gas prices. Natural gas prices have also been suppressed by a lot of wind power generated in Germany and a recovery in Norwegian gas flow nominations, ICIS LNG analyst Robert Songer told ENGINE.

Singapore’s LNG bunker price has been rather steady and made a most gain of $3/mt over the past week.

High spot demand and price-sensitive buying behaviour among consumers has been supporting Asian LNG prices, according to an Energy Flux report. Japan's LNG demand is expected to rise following an earthquake in the Fukushima region, Tony Jordan, senior Partner at Auxilione wrote in a market report.

Prompt availability of LNG bunkering remains tight in Singapore, a trader said.

EUAs

The Dec24 ICE EUA futures contract moved €1.00/mtCO2e ($0.78/mtCO2e) higher over the past week, to trade around $65/mt on Friday.

EUAs' upward price trend was mainly influenced by aggressive buying at lower levels, commodities brokerage Freight Investor Services (FIS) said in a report. The absence of the biweekly Polish EUA auction on 6 March tightened the market, adding support to the price, FIS said.

By Konica Bhatt and Erik Hoffmann

Related: ENGINE introduces price tracker of comparable alternative and conventional bunker fuels

 

Photo credit and source: ENGINE
Published: 19 March 2024

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Biofuel

Argus Media: Bunkering sector needs deeper dive into B24 bio bunker fuel market

‘As we advance into 2025, the need to understand how B24 matures in terms of market fundamentals, pricing and dynamics will be a key indicator for the marine sector,’ says Mahua Chakravarty of Argus.

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Argus Media organises free admission ‘Argus Asia B24 Forum’ for bunkering sector

Ahead of Argus Asia B24 Forum, Manifold Times interviewed Mahua Chakravarty, Head of Marine Fuels Pricing (Asia) of independent global energy and commodity market intelligence provider Argus Media; she explains the growing prominence of B24 bunker fuel in the marine sector and believes it is imperative for the bunkering sector to deepen its knowledge on it:

MT: Why is it important for the bunkering sector to know more about the B24 bunker fuel market?

B24 has emerged as the first alternative marine fuel that allows ship-owners and charterers a drop-in fuel option, and make greenhouse gas (GHG) savings, for their voyages into EU and territorial waters.

It has proved to be the most practical solution for ship-owners that eliminates costly retrofitting charges. The easy availability of used cooking oil methyl ester (UCOME) as a blendstock from China and southeast Asia, also adds to its overall attractiveness as an alternative fuel.

B24 consumption in the port of Singapore recorded multi-fold jumps to touch 518,000t in 2023 as ship-owners fuelled for trials in preparation for the implementation of EU-led mandates like the EU Emissions Trading Scheme (ETS) and the Carbon Intensity Index (CII) rating. In 2024, B24 demand has continued to grow with 377,800t of consumption seen up to August, according to statistics from the Maritime and Port Authority of Singapore (MPA).

As we advance into 2025, the need to understand how B24 matures in terms of market fundamentals, pricing and dynamics will be a key indicator for the marine sector. Being the first generation of new marine fuels, B24 has shown the way that biofuel blends can provide a solution for ship-owners/charterers to meet compliance mandates set by the EU and IMO.

MT: Why has Argus developed its own B24 Singapore price index? What's so special about it and why should the industry adopt it as a benchmark?

Argus was the first to launch its spot B24 delivered on board (DOB) Singapore assessment in January 2023, thus introducing price discovery for this market at its point of inception. The past 1.5 years of daily price assessments of B24, using a robust market survey approach, has built Argus’ understanding of this market from the start.

We have seen the growth of liquidity and the quest among refiners, traders, ship-owners to find pricing solutions for a nascent market. We have been at the forefront of capturing spot liquidity growth and in assessing prices for this market.

This index is now considered a key price assessment by key refiners, traders, ship-owners and other stakeholders in the market.

MT: What takeaways can each segment of the bunkering sector such as bunker buyers, bunker traders, and shipowners receive from the upcoming Argus B24 forum?

The Argus B24 Asia Forum is aimed at showcasing some of these learnings by a global team that covers key markets like Singapore, China and Europe. Our global team will present their insights on the key trends driving demand for marine biodiesel globally.

As the marine sector marches onwards with the bunkering of higher biofuel blends, this forum will allow the audience to reflect on the key factors that have driven the marine biodiesel sector. It will provide insights to make better decisions about infrastructure, pricing, feedstock-related issues and what blends are likely to be prevalent in the coming year.

We will be hosting a panel discussion at this forum that will include key players driving the marine biodiesel space in Singapore and other regions.

The Argus Asia B24 Forum will be held in The Village Hotel (The Events Centre by Far East Hospitality), Sentosa, Singapore (Google Maps) on 8 October between 4.00pm to 7.00pm Singapore Time.

Participants are encouraged to register for the free event via the custom link here.

Related: Argus Media organises free admission ‘Argus Asia B24 Forum’ for bunkering sector

 

Photo credit: Argus Media
Published: 4 October 2024

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Bunker Fuel

Brazil: Raízen launches new bunkering operation in Itaqui

Operation will support both coastal and oceangoing vessels at Off Port Limits, allowing the firm’s customers to avoid full port call fees and unnecessary deviations, says Paula Georgopoulos Tinoco.

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Brazil: Raízen launches new bunkering operation in Itaqui

Brazilian energy firm Raízen has launched its new bunkering operation in Itaqui at the Outer Anchorage Area, according to Paula Georgopoulos Tinoco, Bunker Sales Coordinator at Raízen on Wednesday (3 October).

The firm is providing local supplies for the grades VLSFO380 (max. 0.5%S) and LSMGO DMA (max. 0.1%S). 

“The new bunkering operation will support both coastal and oceangoing vessels with different sizes and class at the Off Port Limits, allowing our customers to avoid full port call fees and unnecessary deviations at different bunkering ports,” she said in a social media post.

In September last year, Bunker Holding subsidiary Bunker One announced that it partnered with Acelen, the largest bunker producer in the Brazilian state of Bahia, to offer the only outer anchorage bunkering operation in Brazil at the time. 

Starting September 2023, vessels such as large cargo ships and tankers can be supplied in the anchorage area of the Port of Itaqui in São Marcos Bay (MA).

Related: Brazil: Bunker One and Acelen partner to launch bunkering operation outside Port of Itaqui

 

Photo credit: Raízen
Published: 4 October, 2024 

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Business

Rahim Oberholtzer named as new Infineum Chief Financial and Strategy Officer

Oberholtzer, a finance executive with over 25 years of experience, joins Infineum from Shell, where he has held various senior positions including Senior Vice President of Shell Finance for Chemicals and Products.

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Rahim Oberholtzer named as new Infineum Chief Financial and Strategy Officer

International fuel additives company Infineum on Thursday (3 October) announced the appointment of Mr. Rahim Oberholtzer as the new Chief Financial and Strategy Officer, effective 1 October.

Oberholtzer will succeed Mr. Philippe Creteur, who has retired at the end of September 2024, after 18 years of dedicated service to Infineum.

Oberholtzer, a seasoned finance executive with over 25 years of diverse experience, joins Infineum from Shell, where he has held various senior positions. His most recent role was Senior Vice President of Shell Finance for Chemicals and Products.

During his career, Oberholtzer has acquired extensive expertise in public accounting, investment banking, and trading. He began his professional journey at KPMG in San Francisco as an auditor. He then moved on to Merrill Lynch, focusing on mergers and acquisitions and equity offerings within the energy sector, ultimately serving as Head of Structured Finance at Merrill Lynch Commodities. 

In 2011, he joined Shell’s Mergers and Acquisitions team in the U.S., leading key projects such as the launch of Shell Midstream Partners and the Eagle Ford divestment. He subsequently managed finance teams in Trading & Supply, covering European Gas & Power, Global Crude, and Global Products & Operations.

Infineum CEO Aldo Govi, said: “We are deeply grateful for Philippe’s years of dedication and excellent contribution to Infineum. At the same time, I am thrilled to welcome Rahim to our corporate leadership team.”

 

Photo credit: Infineum
Published: 4 October, 2024 

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