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Analysis

North P&I: Tight Time Bars in the US for Bad Bunkers

Buyers may wish to consider placing seller on notice of potential claims arising due to fuel issues.

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North P&I Club issued the following statement on Tuesday in regards to off-spec bunker fuels appearing at the US Gulf:

Contaminated IFO 380 bunkers in the US Gulf have resulted in a significant number of vessels experiencing system clogging and, in more extreme cases, engine damage.

The principal contaminant has been identified as the phenolic compound 4-Cumyl-Phenol. This compound has adhesive (sticky) characteristics and is commonly used in the manufacture of epoxy resins and pesticides. This has led to clogging of fuel filters on board vessels and in some cases damage to the engine. The sticking or seizure of fuel pumps has been particularly troublesome.

The problem is not limited to one fuel supplier and it is difficult at this stage to identify the definitive source. However, the contamination has been linked to the use of fuel oil cutter stock, a product added to residual fuels to reduce viscosity.

It is important to note that standard testing of fuel in accordance with ISO 8217 will not identify this contaminant and additional specialist testing is required in order to do so. Vessels bunkering fuel at ports in the US Gulf may wish to consider this additional testing when sending the fuel samples to their chosen laboratory. However, it should be noted that the limited number of laboratories worldwide which are capable of carrying out the additional tests are currently experiencing a significant backlog as a result of the Houston fuel issues.

Engineers should pay particular attention to the fuel system and engines when using these fuels and take early action if problems such as fuel pump seizures or filter clogging are noted.

In addition to the practical issues outlined above, the notoriously short time-bar clauses in bunker supply contracts are problematic, particularly in circumstances where there may be a delay between stemming the bunkers in question and starting to burn them, with problems not becoming apparent until that time. Many contracts require disputes as to the quality or quantity of fuel to be notified to the seller within 30 days of delivery, failing which the claim is deemed waived and time-barred. Liability caps stipulated in the contracts give rise to further issues. Naturally, the bunker supply contracts which concern stems made in the US Gulf tend to be governed by US law, which will likely recognise and give effect to contractual time bars and liability caps. However, there may be an alternative route available to buyers which circumvents problematic contractual clauses where claims are brought in tort.

Should buyers have concerns about the quality of fuel stemmed prior to burning and prior to the expiration of the time-bar, they may wish to consider placing the seller on notice of potential claims arising in relation to the stem. Whilst this may be of assistance in protecting the buyer’s position in relation to the time-bar, so far as we are aware the argument has not yet been tested in the US Courts.

Related: FOBAS suggests ‘quick solution’ to spot contamination, such as US Gulf bunker issues
Related: IBIA: Comment on current problem fuels at US Gulf
Related: U.S. Coast Guard issues bunker safety alert
Related: FOBAS: Fuel Problems in the Galveston Area

Published: 4 July, 2018
 

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Milestone

Singapore retains ranking as world’s top maritime centre for 12th consecutive year

Finds report jointly published by the Baltic Exchange and China’s Xinhua News Agency.

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Singapore bunker tankers and sky

Singapore on Friday (11 July) said it has retained its ranking as the world’s top maritime centre, marking the 12th consecutive year it has led the Xinhua-Baltic International Shipping Centre Development (ISCD) Index.

Jointly published by the Baltic Exchange and China’s Xinhua News Agency, the Xinhua-Baltic ISCD Index provides an independent benchmarking of the world’s leading maritime hubs.

It evaluates factors such as cargo throughput, port infrastructure, maritime services (including finance, law and shipbroking), and the overall business environment.

The index is closely monitored by shipping lines, port investors, and maritime service providers to track market competitiveness, and inform investment location and service development decisions.

Singapore retained its top position among 43 maritime cities and regions, underpinned by its consistent performance as one of the world’s busiest transhipment and bunkering hubs, and a well-established ecosystem of professional maritime services and expertise.

In 2024, Singapore handled 41.12 million twenty-foot equivalent units (TEUs) in container throughput – a record high – and saw total vessel arrival tonnage exceed 3 billion gross tons. The Port of Singapore also remains the world’s largest bunkering port, having supplied 54.92 million tonnes of marine fuel in 2024.

Home to more than 200 international shipping groups and a growing number of maritime technology start-ups, Singapore continues to strengthen its position as a global node for maritime innovation and enterprise.

This growing industry base is also creating new career pathways in areas such as port operations, digital systems management, automation, maritime law, and sustainability – as the sector transforms to meet the needs of a more digital and decarbonised future.

“We thank our industry partners, the research and enterprise community, and our unions who have been instrumental in Singapore’s journey to become a leading international maritime centre and global hub port,” said Ang Wee Keong, Chief Executive of the Maritime and Port Authority of Singapore.

“We will continue to build on this momentum by innovating and investing in digitalisation, green technologies, and workforce development to strengthen Singapore’s position as a trusted and future-ready international maritime centre.”

 

Photo credit: Manifold Times
Published: 14 July 2025

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Research

ICCT policy brief explores benefits of global 0.10% sulphur cap on marine fuels

Studies have found ships using scrubbers with heavy fuel oil emit more particulate matter and black carbon emissions than those using marine gas oil.

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ICCT sulphur policy brief

The International Council on Clean Transportation (ICCT) on Tuesday (8 July) introduced a policy brief examining how further reducing the global maximum allowable fuel sulphur content of bunker fuel from 0.5% to 0.1% could affect air pollution emissions and premature mortality from fine particulate matter (PM2.5).

Currently, ships must adhere to a global 0.5% fuel sulphur limit and a 0.1% limit in ECAs, unless they use scrubbers. However, studies have found that ships using scrubbers with heavy fuel oil emit more particulate matter and black carbon emissions than those using marine gas oil.

The brief considered three compliance pathways:

  1. Scrubber Max scenario in which ships that use very-low sulfur fuel oil (VLSFO) switch to high-sulfur heavy fuel oil (HFO) with scrubbers to comply;
  2. Scrubber Allowed scenario in which ships that use VLSFO switch to marine gas oil (MGO) to comply;
  3. Distillate Only scenario in which scrubbers are not allowed and ships that use HFO and scrubbers or VLSFO switch to MGO to comply.

In summary, the research found that relative to a baseline scenario based on 2023 ship activity data, reducing the sulphur content of marine fuels to comply with a 0.1% sulphur limit would:

  • Mitigate air pollution. Across the three compliance scenarios, shipping-attributable sulfur oxide emissions are estimated to fall by 75%–85%, PM2.5 by 46%–66%, and black carbon by 27%–41%. The scenario prohibiting scrubbers yields the highest estimated emission reductions.
  • Reduce premature deaths. The three compliance scenarios avoid between 3,900 and 4,500 premature deaths annually, with the most significant reductions achieved when scrubbers are not allowed.
  • Deliver substantial economic benefits. Health-related economic benefits are estimated to range from $9.3 billion to $10.9 billion annually, depending on the compliance pathway.
  • Incentivize cleaner fuels. A global 0.1% sulfur standard that promotes distillate fuel use would increase baseline fossil fuel costs and reduce the price gap between conventional and zero or near-zero greenhouse gas emission fuels.

The complete policy brief Health and air pollution benefits of a global 0.1% fuel sulfur limit  on marine fuels can be obtained from the link here.

 

Photo credit: International Council on Clean Transportation
Published: 9 July 2025

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Research

Integr8 Fuels report shares comprehensive analysis of Mediterranean ECA

Data reveals a market in rapid transition, confirming some industry predictions while uncovering new, emerging risks for ship operators.

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Integr8 Fuels trading intelligence (July 2025)

International bunker trading firm Integr8 Fuels on Monday (7 July) shared its new report ‘Mediterranean ECA: Immediate Operational and Commercial Impact of Implementation’ which provides the first comprehensive analysis of the rule’s effects on fuel quality and regional availability.

The data reveals a market in rapid transition, confirming some industry predictions while uncovering new, emerging risks for ship operators. The following key findings include:

  1. Dramatic Supply Shift Confirmed: VLSFO Availability Contracts Sharply. VLSFO’s share of the Mediterranean fuel market has plummeted from over 60% in December to just 37.5% in May. In parallel, the number of ports supplying VLSFO has fallen by 47%, creating new logistical challenges for vessels that continue to use the grade.
  2. VLSFO Instability Spikes as Supply Chain Adapts. Very Low Sulphur Fuel Oil (VLSFO) off specification rates more than doubled from 1.5% in December to 3.8% in May. Critically, one in four (25%) of these off-specs were for total sediment potential (TSP), indicating a rising risk of sludge formation that can damage engines. This trend appears linked to extended in-tank storage and the consolidation of older fuel stocks as demand slows and suppliers pivot away from VLSFO.
  3. Persistent Flash Point Risks in Key LSMGO Hubs. Flash point non-conformance has increased significantly and now accounts for over two-thirds of all LSMGO off specs. Our data shows this is not a random problem, with over 75% of all flash point incidents concentrated in Spain, Turkey, and Italy, signalling a persistent potential for SOLAS violations in core supply zones.

Note: The full report may be obtained from Integr8 Fuels here.

 

Photo credit: Integr8 Fuels
Published: 8 July 2025

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