Alternative Fuels

ENGINE on Fuel Switch Snapshot: LNG defies the downturn

Conventional bunker prices nosedive on Brent’s collapse; bio-blends tumble with fossil components; LNG soars while other bunker fuels plummet.

Published

9 months ago

August 6, 2024

Admin

ENGINE on Fuel Switch Snapshot: LNG defies the downturn

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:

5 August 2024

Conventional bunker prices nosedive on Brent’s collapse
Bio-blends tumble with fossil components
LNG soars while other bunker fuels plummet

Conventional bunker fuel prices have nosedived in the past week following a massive selloff in the front-month ICE Brent futures contract. Brent futures dropped by a significant $4.32/bbl ($32/mt) over the past week, reaching their lowest level in eight months.

This marks the most aggressive selloff in Brent since May, according to Warren Patterson, head of commodity strategy at ING. Fears of a recession in the US, combined with weaker oil demand from China, have offset concerns that oil supply could be severely affected if the conflict in the Middle East escalates further, Patterson noted.

LNG is no longer the cheapest alternative for dual-fuel ships in Rotterdam and Singapore. The VLSFO-equivalent LNG bunker price in Rotterdam has flipped from a $34/mt discount to a $44/mt premium over its VLSFO. When adding in estimated EU Allowances (EUA) costs - which favour LNG over VLSFO - Rotterdam’s LNG is $32-38/mt costlier than its VLSFO.

Singapore’s LNG premium over VLSFO has widened by $23/mt, to $39/mt with estimated EUA costs added, and $45/mt without.

The price gap between Rotterdam’s HBE-qualified B24-VLSFO blend and LNG has narrowed by a sharp $79/mt in the past week, to $123/mt.

Singapore’s UCOME-based B24-VLSFO blend is $86/mt more expensive than its LNG, reflecting a $24/mt drop from a week ago.

VLSFO

Rotterdam's VLSFO price has dropped by $16/mt in the past week, or by $12-14/mt when we add the estimated EUA costs.

Singapore’s VLSFO price has slipped $8-10/mt lower in the past week with estimated EUA cost added.

VLSFO availability remains tight in both Rotterdam and Singapore. Although Brent’s sharp decline over the past week has driven prices lower, tight VLSFO availability in both Rotterdam and Singapore seems to have prevented more significant reductions.

VLSFO is in low demand in Rotterdam, a source said. This could have added some downward pressure on the price.

In Singapore, VLSFO availability has tightened as several suppliers are running low on stock or have limited barge availability. Most suppliers now recommend lead times of 12-22 days, up from 12-18 days the week prior.

Biofuels

Rotterdam's B24-VLSFO HBE price has decreased by $13-16/mt, and its B24-LSMGO HBE price has dropped by a more significant $20-23/mt in the past week - both including estimated EUA costs.

The two benchmarks have declined amid a drop in the values of pure LSMGO ($23/mt) and pure VLSFO ($16/mt) and the price of palm oil mill effluent methyl ester (POMEME) feedstock ($20/mt).

Rotterdam sold about 234,000 mt of bio-blended bunkers in the second quarter, down by 11% from the previous quarter. Nearly 70% of the bio-bunkers sold in the second quarter was VLSFO-blended.

Singapore’s B24-VLSFO UCOME price has shed $9-10/mt in the past week, while its B24-LSMGO UCOME price has declined by a greater $17-19/mt. A $10/mt drop in the UCOME FOB China benchmark has added downward pressure on both the benchmarks.

Pricing activity for Chinese UCOME FOB in bulk was mostly muted last week because of impending EU tariffs on Chinese biodiesel imports, according to PRIMA Markets.

LNG

Rotterdam’s LNG bunker price has shot up by $62/mt in the past week. If we add the estimated EUA costs, the price has increased by another $2-4/mt over the outright price.

The price has spiked on the back of a strenghtening underlying Dutch TTF contract, which rolled from August to a higher-priced September contract. Rising LNG demand due to heatwaves across southern Europe have also added upward pressure on the price.

Concerns over supply constraints due to an outage at Norwegian operator Equinor’s Visund gas field and a maintenance shutdown at Norway’s Kaarsto gas-processing facility have also contributed to the price increase.

Singapore’s LNG benchmark has jumped $13-15/mt higher in the past week.

The Ichthys LNG train 2 in Australia, operated by Japanese oil firm Inpex, is running at approximately 80% of its processing capacity following a 19 July outage. It is expected to remain at reduced capacity through August, according to Rystad Energy. It is a major LNG supplier to Asia-Pacific with a processing capacity of 4.45 million mt/year.

In addition, China, Japan and South Korea are forecast to experience above-average temperatures until 13 August, which will likely keep gas demand high, Rystad added.

By Konica Bhatt

Photo credit and source: ENGINE
Published: 6 August, 2024

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Biofuel

Hercules Tanker Management vessel “Mount Kibo” takes on B30 bio bunker fuel

HTM said its tanker was successfully supplied with B30 bunkers by tanker “Hercules Sky”, another HTM-owned vessel and operated by Peninsula, marking the first biofuel supply to the HTM fleet.

Published

2 hours ago

April 30, 2025

Admin

Hercules Tanker Management vessel “Mount Kibo” takes on B30 bio bunker fuel

Hercules Tanker Management (HTM) on Tuesday (29 April) announced that its tanker Mount Kibo has been successfully supplied with B30 bunkers by tanker Hercules Sky, another HTM-owned vessel which is operated by Peninsula.

The operation marked the first biofuel supply to the HTM fleet.

HTM is the shipping venture launched last September by John A. Bassadone, founder and CEO of independent marine fuel supplier Peninsula.

HTM said the operation carried out in the Strait of Gibraltar aligns with the recent discussions at MEPC 83, where key decisions were made to advance maritime decarbonisation, including new fuel standards and a global pricing mechanism for emissions.

“Additionally, this initiative supports the objectives of the FuelEU Maritime Regulation, which promotes the use of renewable, low-carbon fuels and clean energy technologies for ships,” it said.

“By utilising biofuels, we are contributing to the reduction of greenhouse gas emissions and supporting the industry's transition towards cleaner energy solutions.”

Photo credit: Hercules Tanker Management
Published: 30 April, 2025

Alternative Fuels

DNV: Seven steps to obtain approval for ammonia- and hydrogen-fuelled ships

DNV summarizes how shipowners can apply a practical, structured approach to gaining approval for ammonia- or hydrogen-fuelled ships as both are gradually emerging as suitable bunker fuels.

Published

2 hours ago

April 30, 2025

Admin

Classification society DNV on Monday (28 April) released an article summarizing how shipowners can apply a practical, structured approach to gaining approval for ammonia- or hydrogen-fuelled ships.

From engaging early with flag administrations to addressing design risks, training crews, and managing bunkering safely, DNV described seven essential steps to receive approval:

The paper – Safe introduction of alternative fuels: Focus on ammonia and hydrogen as ship fuels – offers a structured pathway for shipowners to achieve approval through IMO’s alternative design approval (ADA) process.

Seven steps to obtain approval for ammonia- and hydrogen-fuelled ships

“We outline seven steps to assist shipowners and other stakeholders in obtaining approval and safely deploying ammonia- and hydrogen-fuelled ships in today’s immature regulatory environment,” says Linda Hammer, Principal Consultant, Environment Advisory at DNV and lead author of the white paper. “The regulatory path is certainly complex, but the steps and safety measures in the paper add up to a clear, achievable pathway to ship approval and safe operations. It also explains how DNV’s support can significantly ease this process through its tailored rule sets and learnings from pilot projects.”

t1 ind 586 steps to obtain approval (1)

Understanding ADA phases: From initial design to final approval

IMO’s IGF Code (International Code of Safety for Ship Using Gases or Other Low-flashpoint Fuels) currently covers natural gas but not ammonia or hydrogen. Without detailed regulations, IMO’s risk-based ADA process (MSC.1/Circ.1455) is used. It involves demonstrating that the ship’s safety level is equivalent to that of conventional oil-fuelled vessels.

t4 ind 586 milestones in the two phases (1)

ADA has two main phases. A preliminary design approval requires a hazard identification (HAZID) study, developing a preliminary risk assessment, and defining preliminary risk-control measures and safety strategies.

Phase two, final design approval, starts with refining the design with detailed technical and safety documentation, then making a final risk assessment, addressing integration and operation-specific concerns. Then come complete system integration testing and submitting findings to the flag administration.

Role of class and flag administrations in approval process

As the IMO regulatory framework progresses towards eventually amending the IGF Code, classification societies like DNV can give shipowners a head start in designing vessels by issuing class certificates and providing prescriptive rule frameworks to support ADA.

t2 ind 586 the status of the development of imo safety regulations

Flag administrations enforce statutory regulations and have the final say on approvals. Early and active engagement with the relevant flag administration is therefore the key to clarifying approval expectations and streamlining ADA.

Subject to flag administration acceptance, the DNV rules can be applied as the flag administration’s approval basis or to significantly reduce the complexity of ADA.

Simplifying ship approval: DNV’s rules for ammonia and hydrogen fuels

DNV’s classification rules for ammonia and hydrogen (i.e. the “Gas fuelled ammonia” notation published in 2021 and the 2024 “Gas fuelled hydrogen” notation) provide structured, prescriptive requirements as far as possible to simplify ADA. Applying them helps reduce uncertainty in flag administration approval, streamlines design focus by aligning with expected risk assessments, and provides predictability to shipowners, ship designers and shipyards.

The paper describes step-by-step actions for obtaining approval. First, engage DNV and the flag administration early to clarify the approval basis. “DNV can help owners and yards in the initial contact with the flag administration to obtain necessary clarification regarding the approval scope and process,” says Hammer.

Second, align the design with DNV rules to ensure it provides a strong technical basis for risk evaluation. Third, tap into DNV’s extensive and growing experience from prior projects to anticipate what risk studies and documentation may be needed.

The paper also discusses measures to manage the new technical, human and organizational risks that both fuels bring compared to conventional fuels. DNV’s dedicated ship rules for each fuel type outline technical requirements and mitigation systems to integrate during design and operation.

Note: DNV’s full article on ‘Practical guide for approval of ammonia- or hydrogen-fuelled ships’ can be read here.

Photo credit: DNV
Published: 30 April, 2025

Methanol

Ofiniti to roll out e-BDNs for Golden Island methanol bunkering operations in Singapore

Ofiniti will issue electronic Bunker Delivery Notes, based on the recently published Technical Reference 129 on Methanol Bunkering, across Golden Island’s newbuilds and part of its existing fleet.

Published

1 day ago

April 29, 2025

Admin

Ofiniti to roll out e-BDNs for Golden Island methanol bunkering operations in Singapore

Ofiniti, a provider of digital solutions for maritime bunker operations, on Tuesday (29 April) said Singapore bunker supplier Golden Island Pte Ltd will adopt Ofiniti platforms for its expanding fleet operations.

Ofiniti said the move will lay the foundation for a digital multi-fuel future with Golden Island’s four new chemical tankers on order and Singapore-flagged bunker tanker Golden Antares, which will soon enter service.

As part of the transition, Ofiniti will roll out electronic Bunker Delivery Notes (e-BDNs), based on the recently published Technical Reference (TR) 129 on Methanol Bunkering, across Golden Island’s newbuilds and part of its existing fleet.

The Maritime and Port Authority of Singapore (MPA) and Enterprise Singapore (EnterpriseSG), through the Singapore Standards Council (SSC), on 10 March published TR 129 to provide a comprehensive framework for the safe and efficient use of methanol as an alternative fuel for bunkering operations.

Kenny Yap Song Jin, Low Carbon Solutions, Golden Island, said: “Launching our methanol bunkering operations is a major milestone, not just for Golden Island, but for Singapore’s journey toward multi-fuel readiness.

“By combining innovative low-carbon fuels with digital transparency, we set a new benchmark for safe, efficient, and sustainable marine fuel delivery.”

Ofiniti said it has supported suppliers through every stage of the industry’s transition, from conventional fuels to LNG, biofuels, hydrogen, and now, supporting methanol.

Tue Nielsen, Chief Executive Officer, Ofiniti, said: “I’m proud to welcome Golden Island to Ofiniti’s platforms.

“Their move signals a strong trust in our ability to support next-generation operations, and it reflects a broader shift in the market towards digital solutions built specifically for the realities of maritime fuels today and tomorrow.

“We are customer-obsessed, always trying to build in resilience to the way we are doing business.”

Manifold Times previously reported Golden Island’s plans to start bunkering trials of green methanol with its newbuild Singapore-flagged 7,999 dwt IMO type 2 bunker tanker from July.

Golden Antares was scheduled to depart a Chinese shipyard by late April and will lift green methanol produced by Hong Kong and China Gas Company Limited (Towngas) before returning to Singapore to begin bunkering trials.

In April, Ofiniti welcomed bunkering and marine fuel solutions provider Global Fuel Supply (GFS) to its FuelBoss platform as one of its newest customers.

GFS said it was proud to be the first physical supplier in West Africa to launch fully digitalised bunker operations with electronic bunker delivery note (e-BDN) via the FuelBoss platform.