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ENGINE on Fuel Switch Snapshot: LNG rises towards VLSFO

Singapore’s LNG bunker price soars; bio-premiums over LNG narrow substantially; VLSFO benchmarks remain stable.

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ENGINE on Fuel Switch Snapshot: LNG rises towards VLSFO

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:

20 May 2024

  • Singapore’s LNG bunker price soars
  • Bio-premiums over LNG narrow substantially
  • VLSFO benchmarks remain stable

Rotterdam's fossil LNG bunker price has edged closer to its VLSFO by $7-8/mt over the past week, now making it 54-66/mt cheaper than VLSFO.

The price gap between LNG and VLSFO has narrowed even further by $34/mt in Singapore because of the sharp rise in LNG bunker price. LNG bunker price in Singapore is now at a $30-36/mt discount to its VLSFO, depending on whether the estimated EU Allowance (EUA) costs are added to their bunker fuels costs.

Singapore’s biofuel price premiums over fossil LNG has narrowed by $41/mt to $142/mt in the past week. In Rotterdam, the bio-bunker premium over LNG has narrowed by $14/mt to $179/mt.

B24-VLSFO price premiums over pure VLSFO are $125/mt in Rotterdam and $113/mt in Singapore.

VLSFO

Rotterdam’s VLSFO benchmark inched $1/mt lower in the past week. When we add estimated EUA costs, there is only a slight decline of $1-2/mt, depending on whether we are looking at voyages between EU ports or between EU ports and non-EU ports.

VLSFO availability remains good in the wider ARA hub. Lead times of 3-5 days are currently advised for the grade in Rotterdam, down from 4-5 days seen earlier, a trader said.

Singapore’s VLSFO benchmark also remained relatively steady in the past week, with a modest $4/mt decline.

VLSFO availability has improved in Singapore, with most suppliers suggesting lead times of 4-7 days, much shorter than the previous week's 6-12 days.

Biofuels

Rotterdam’s B24-VLSFO HBE bunker price has moved $8/mt lower in the past week.

Prices for palm oil mill effluent methyl ester (POMEME) have declined by $25/mt to $1,298/mt in the past week. This has partly contributed to the bio-bunker price declines in Rotterdam. POMEME-based biofuels can qualify for advanced biofuel rebates through the Dutch HBE system.

Singapore’s B24-VLSFO UCOME bunker price has declined by $11-12/mt in the past week, depending on whether the price is adjusted with estimated EUA costs.

The prices have come down amid a $30/mt drop in UCOME FOB China prices, which is down because of weak demand from the EU.

LNG   

Rotterdam’s LNG bunker benchmark has seen a modest $6-7/mt gain in the past week, depending on whether estimated EU ETS costs are included in the cost of fuel. The gains have mirrored increases in the front-month NYMEX Dutch TTF Natural Gas benchmark.

Despite the EU's gas storage levels being full at 67%, which is higher than last year, the TTF benchmark has increased. Analysts predict that Europe will head into the next winter with full storage, potentially leading to lower prices, head of commodities strategy at ING Warren Patterson said.

Singapore’s LNG bunker price has surged by $29-30/mt in the past week. This steeper increase is partly linked to the underlying NYMEX Japan/Korea Marker contract (JKM), which has rolled from the June to the higher-priced July contract, elevating the JKM benchmark and bunker prices.

By Konica Bhatt

 

Photo credit and source: ENGINE
Published: 21 May 2024

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LNG Bunkering

Malaysia: Port of Tanjung Pelepas achieves milestone with first SIMOPS LNG bunkering op

LNG bunker vessel “MT Paolina Cosulich” refuelled LNG dual-fuel container ship “Bangkok Express”, operated by Hapag-Lloyd AG at the port.

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Malaysia: Port of Tanjung Pelepas achieves milestone with first SIMOPS LNG bunkering op

Port of Tanjung Pelepas (PTP) on Sunday (16 February) said it successfully conducted its first Simultaneous Operations (SIMOPS) of liquefied natural gas (LNG) bunkering.

This significant achievement involved the LNG dual-fuel container ship Bangkok Express, operated by Hapag-Lloyd AG, and the LNG bunker vessel MT Paolina Cosulich.

“This milestone underscores PTP's dedication to enhancing our competitive edge in the global market by facilitating clean and efficient maritime operations,” the port said in a social media post.

“We are proud to have partnered with PETCO Trading Labuan Co., Ltd. (PTLCL) and Hapag-Lloyd on this pioneering initiative.”

Manifold Times previously reported the port also achieving its first LNG bunkering operation last year. 

The port completed its first-ever ship-to-containership methanol bunkering operation in November last year. 

Manifold Times previously reported the port achieving its first LNG bunkering operation last year. 

Related: Malaysia: Port of Tanjung Pelepas achieves milestone with first methanol bunkering op
Related: Malaysia: Port of Tanjung Pelepas completes first LNG bunkering operation
Related: Malaysia: Tanjung Pelepas selected to join P41 initiative to achieve green bunkering hub ambition
Related: Port Of Tanjung Pelepas joins G2G decarbonisation scheme between Malaysia and Australia

 

Photo credit: Port of Tanjung Pelepas
Published: 18 February, 2025

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LNG Bunkering

Kunlun Energy wraps up first STS offshore LNG bunkering operation in Hong Kong

Kunlun Energy, a red-chip controlled by PetroChina, said its bunkering vessel refuelled container ship “Zim Haifa Blue Stone” with 2,200 metric tonnes of LNG bunker fuel in a seven-hour operation.

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Kunlun Energy wraps up first STS offshore LNG bunkering op in Hong Kong

Kunlun Energy, a red-chip controlled by PetroChina, on Monday (17 February) said it completed Hong Kong’s first ship-to-ship (STS) offshore liquefied natural gas (LNG) bunkering operation on 14 February. 

Kunlun Energy's 8,300 m3 capacity LNG bunkering vessel refuelled the container ship Zim Haifa Blue Stone with 2,200 metric tonnes (mt) of LNG in a seven-hour operation. 

The bunkering vessel involved in the operation is operated by a Kunlun Energy subsidiary. 

According to a PetroChina official, the receiving vessel Zim Haifa Blue Stone departed from Busan, South Korea, on 3 February and passed through Qingdao, Shanghai, and Ningbo before arriving in Hong Kong on 12 February. 

Its final destination is Istanbul, Turkey. This refuelling operation can meet the ship's fuel needs for the entire journey. 

“The successful implementation of this "ship-to-ship" offshore LNG bunkering operation is another example of Kunlun Energy's efforts to help improve the international shipping hub of the Guangdong-Hong Kong-Macao Greater Bay Area,” Kunlun Energy said. 

“It is expected to attract more green-fuel vessels to pass through Hong Kong, encourage more environmentally friendly companies to conduct business in Hong Kong, accelerate transformation and technological innovation in the shipping industry, and promote the construction of Hong Kong as a green and smart port.”

“This operation holds significant importance for Hong Kong's push toward a green and sustainable shipping industry.”

 

Photo credit: Kunlun Energy
Published: 18 February, 2025

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Biofuel

Wallenius Wilhelmsen successfully completes its first biofuel bunkering trial in Japan

“M/V Tamesis” bunkered 400 metric tonnes of B24 VLSFO blended biofuel, supplied by Mitsubishi Corporation Energy at Port of Yokohama.

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Wallenius Wilhelmsen successfully completes its first biofuel bunkering trial in Japan

Wallenius Wilhelmsen on Monday (17 February) said it has successfully completed its first biofuel bunkering trial at the Port of Yokohama in Japan.

M/V Tamesis bunkered 400 metric tonnes (mt) of B24 VLSFO blended biofuel, supplied by Mitsubishi Corporation Energy. 

This milestone is part of Wallenius Wilhelmsen’s ongoing efforts to reduce its environmental impact and promote sustainability in shipping.

“As part of our commitment to reducing greenhouse gas emissions, we have expanded our locations for biofuel supply. Since 2023, the expansion has included key ports in Belgium, Korea and Singapore,” the company said.

“Expanding to Japan enhances our ability to operate more efficiently and sustainably across our global network.”

Wallenius Wilhelmsen has set ambitious emission reduction targets to reach net-zero by 2040. This includes a 40% absolute reduction of well-to-wake greenhouse gas emissions by 2030 compared to our 2022 baseline, as approved by the Science Based Targets initiative.

Yasuyuki Sakurai, Senior Manager, the Orcelle Accelerator taskforce at Wallenius Wilhelmsen, said: “Achieving these targets require a major shift in energy sources from conventional fuels to low and zero-carbon alternatives. Expanding supply locations and securing sufficient biofuels remain a priority, and we are pleased to have conducted our first B24 VLSFO blended biofuel bunkering trial in Yokohama.”

“While our Reduced Carbon Service customers fully support our mass-balance concept, ensuring sufficient biofuel usage across our entire fleet and trade lanes is key to achieving our long-term sustainability goals.”

Mitsuo Ueda, General Manager of Mitsubishi Corporation Energy, said: “In anticipation of growing demand for biofuel in the marine sector, we have begun storing biofuel at our oil terminal in Onahama (Fukushima Prefecture) and supplying B24 in Tokyo Bay using our barges.:

“We deeply admire Wallenius Wilhelmsen’s leadership in the decarbonisation of the shipping industry and remain committed to playing our part in creating a more sustainable future. We will continue striving to meet industry needs through a stable supply of biofuels and contribute to the realisation of a carbon-neutral society.”

This milestone was achieved through close collaboration between Wallenius Wilhelmsen’s Energy Sourcing team and the Orcelle Accelerator taskforce, which has worked for the past two years to establish biofuel bunkering capabilities in Japan.

 

Photo credit: Wallenius Wilhelmsen
Published: 18 February, 2025

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