The crash in demand for air travel and jet fuel due to the Covid-19 pandemic has caused the industry to use the product as a blending component in the production of low sulphur bunker fuel, reports Bloomberg.
Allegedly, jet fuel was used to blend bunker fuel in Singapore through April and May when prices were close to $20 per barrel from $70 per barrel in January and the demand for air travel is not expected to recover until 2024.
A specialist for fuels at Lloyd’s Register has purportedly cautioned that while jet fuel can indeed be used in a marine fuel blend, it can have a far lower flash point which can be a safety hazard for vessels.
Universal Alliance, BMS United, Digiland International, Goodwood Associates, Southernpec (Singapore), and Taigu Energy were involved in alleged circular fictitious trades of fuel oil during July 2015.
Bunker orders of ISO 8217:2010 spec LS 380 cSt 0.5% for Nord Gemini, Nord Titan, Ocean Rosemary, and Luzern were placed through global commodities trading and logistics house Trafigura Pte Ltd.
While Covid-19 concerns are important, Captain Rahul Choudhuri was quick to note this does not mean bunker fuel related issues have indeed disappeared from the shipping sector.
‘Therefore, representing the players of the Malaysian bunker industry, we sincerely hope that this matter can be refined and reconsidered immediately so that all parties benefit together,’ says communication.
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‘We [Consort Bunkers] have the opinion that the bunker business in Singapore is not related to the widely reported earlier cargo commodity trading mishaps,’ company source tells Manifold Times.