LNG Bunkering
Glander: LNG and bio-LNG bunker fuel infrastructure, demand and price drivers
Big test for LNG as a marine fuel will be how quickly production of its alternatives can be scaled up, and how quickly shipowners are willing to pay extra cost for these lower-carbon fuels, says Mustafa El Zein.
Global bunker trading firm Glander International Bunkering on Monday (14 October) released an interview with its New Fuels Advisor Mustafa El Zein, who shares insights on the current trends and developments in the LNG market:
LNG as a marine fuel is increasingly in the spotlight, offering a unique alternative to traditional fuels. The alternative fuel has been in use for at least 50 years in marine propulsion, namely on LNG tankers using its own cargo as fuel. In bunkering, LNG started properly developing around the early 2000’s, with the earliest LNG bunkering vessel starting operations around 8 years ago.
Mustafa El Zein explains that as the shipping industry takes on its mammoth task of reducing GHG emissions, LNG is surely becoming an attractive and viable solution due to its lower emissions (compared to fuel oils) and its relative cost competitiveness. This is resulting in the LNG bunkering industry growing rapidly, with bunkering facilities and delivery infrastructure being developed at various locations all over the world.
El Zein continues, “We are even seeing ship operators and owners who had previously dismissed the use of LNG fuelled vessels are now rethinking their decision and opting for the alternative fuel.”
Taking all these factors into account, LNG bunker supply will need to continue to increase to account for the large number of LNG fueled vessels currently on order.
LNG globally
Europe is likely to see the most growth in LNG bunker demand in the next few years, according to El Zein.
The ARA hub is currently the largest location for LNG as a bunker fuel, but Southern Europe is now gaining traction as well; Spain, Portugal and France recently developed solutions both in the Atlantic and Mediterranean.
“Asia – in particular Singapore, Malaysia and China – is also investing heavily, with some good capabilities already in place, and North American ports in the Gulf of Mexico, US East Coast and other strategic locations are expanding their LNG bunkering capabilities,” he says.
LNG bunker demand is expected to grow to 20-25 million mt/year by 2030. This increase aligns with the broader global LNG demand, which is currently around 400 million mt/year and expected to reach 600 million mt/year by 2030. At the same time, the global LNG supply will grow in parallel.
What will drive LNG demand?
Power generation and industrial use are likely to remain the dominant influence on the global LNG market because of their relative size.
According to El Zein, the big test for LNG as a bunker fuel will be how quickly production of its alternatives – bio- and synthetic LNG – can be scaled up, and how quickly shipowners show willingness to pay the extra cost for these lower-carbon fuels.
He says, “The EU’s emissions trading system for shipping and upcoming FuelEU Maritime regulation are already starting to provide an incentive for that switch.”
The regulations are ratcheting up progressively, giving time for ship owners, fuel producers, and industry stakeholders to collaborate towards reaching the goal. El Zein adds, “What’s even more encouraging is the growing awareness within the industry of the need to reduce emissions. This is where the voluntary market is gaining momentum.”
LNG price outlooks
As demand is steadily incentivized by regulation, the challenge will be in supplying bio- and synthetic LNG at sufficient scale.
Biogas prices seem to be on the track of stabilising, and demand, while not that high today, will surely increase as the regulations catch up with fossil LNG’s emissions.
El Zein advises, “Investment in production and infrastructure is needed, and the sooner the better.”
The EU’s target for overall biogas production is 35 BCM per year by 2030, compared with production levels of about 4 BCM in 2022. And a good share of it can and will be used by the shipping sector.
He concludes, “If this target can be met, and similar growth achieved in other key regions, LNG will be an even more attractive proposition for the decarbonization of shipping.”
Related: Glander and Cepsa partner on Mediterranean bio bunker fuel supply for cruises|
Related: Glander International Bunkering renews ISCC certifications for biofuel operations
Photo credit: Glander International Bunkering
Published: 16 October, 2024
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ENGINE on Fuel Switch Snapshot: B100 premiums narrow for Singapore-EU voyages
Rotterdam B100 over $100/mt costlier than HSFO; Rotterdam LBM discounts to LSMGO widen; B100 premium over LSMGO drops to $39/mt 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:
- Rotterdam B100 over $100/mt costlier than HSFO
- Rotterdam LBM discounts to LSMGO widen
- B100 premium over LSMGO drops to $39/mt in Singapore
Rotterdam B100’s premium over HSFO has widened by a further $35/mt to $103/mt over the past week.
On the other hand, its discounts to VLSFO and LSMGO have widened by $8/mt and $25/mt to $26/mt and $266/mt, respectively.
Singapore’s B100 has dropped slightly relative to conventional fuels. Its premiums over HSFO, VLSFO and LSMGO have narrowed by $16-25/mt over the past week to $39-408/mt.
LNG premiums over liquefied biomethane (LBM) in Rotterdam have widened by $15/mt to $440-447/mt.
Rotterdam’s LBM discounts to LSMGO have widened by $56-58/mt to $595-796/mt, depending on the engine type.
Liquid fuels
Rotterdam’s HSFO price has fallen by $41/mt over the past week. Its VLSFO has edged up by $2/mt, while its LSMGO price has increased by $19/mt.
The port’s B100 has edged down by $7/mt. Dutch ZRE A ticket prices have remained unchanged for a third consecutive week amid a “lack of reported trades,” Prima Markets has noted.
Singapore’s conventional fuel prices have declined by $36-45/mt over the past week, while its B100 benchmark has fallen by a larger $61/mt
The port’s monthly B100 sales doubled from 6,500 mt in April to 13,000 mt in May, according to preliminary data from the Maritime and Port Authority of Singapore.
Liquid gases
Rotterdam’s LNG prices have declined by $23-24/mt in the past week, driven largely by a 7% decline in LNG bunker premiums, which dropped from $134/mt to $125/mt. The front-month Dutch TTF Natural Gas contract has fallen by 2%, adding further downward pressure to LNG bunker prices.
Rotterdam’s LBM prices have fallen by $37-39/mt.
Singapore’s LNG prices have edged up by $8-9/mt. Resurging tensions in the Middle East, a Qatari gas facility explosion and rising LNG demand in Asia have added upward pressure on the prices.
LNG sales in Singapore jumped from 42,000 mt in April to a record 70,000 mt in May.
By Konica Bhatt
Photo credit and source: ENGINE
Published: 30 June, 2026
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