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Rystad Energy highlights impact of Mediterranean Sea ECA on bunker market

Company gives an insight on the bunker market with the Mediterranean Sea effectively becoming an ECA for sulphur oxides under MARPOL Annex VI Regulation 14 from 1 May.

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Advisory, research and energy intelligence company Rystad Energy on Wednesday (30 April) gave an insight on the bunker market following the Mediterranean Sea effectively becoming an Emission Control Area (ECA) for sulphur oxides (SOx) under MARPOL Annex VI Regulation 14 from 1 May:

The Mediterranean Sea is fast approaching a deadline to reduce bunker fuel sulfur limits required by the International Maritime Organization (IMO). Nearly a year ago, the Mediterranean Sea was designated as an Emission Control Area (ECA), but in order to maintain this status, very low sulfur fuel oil (VLSFO) will have to virtually be eliminated from vessel fleets in the region. Rystad Energy estimates that ultra-low sulfur fuel oil (ULSFO) will dominate the Mediterranean Sea moving forward, should the IMO’s requirements be met. 

Rystad Energy’s oil market update from Valerie Panopio, Vice President, Commodity Markets Analysis – Oil: 

The inclusion of the Mediterranean Sea to the existing ECA zones leaves very little room for VLSFO in Europe. Now, vessels operating in the Mediterranean Sea must reduce sulfur limits to 0.1% from the previous level of 0.5%. We believe that VLSFO will be displaced by ULSFO, marine gas oil (MGO), and high sulfur fuel oil (HSFO) resulting in a reshuffling of bunker fuel flows and optimization of vessel fleets.

We believe that this regulation of bunker fuel will result in a surge in compliant fuel demand, particularly in MGO.

This will fill in any expected gaps and encourage more flow of MGO from Northwest Europe to the Mediterranean and ultimately from the US and the Middle East.

The rerouting of fuel flows will open an arbitrage of VLSFO from Europe to the East of Suez, catering to Asia’s shortage and depressing VLSFO cracks in the short term. 

Tighter emission controls in the Mediterranean will force vessel operators to revisit strategies on fuel supply and fleet routes, investment on exhaust gas cleaning systems, or “scrubbers”, and exploration of alternative fuels.” 

Vessels plying the Mediterranean have the following options to respond to the tighter emission standards: 

  • Complete switching to 0.1% sulfur bunker fuel such as ULSFO or MGO 
  • Use of separate fuels depending on prevailing regulation 
  • Retrofitting with scrubbers 
  • Exploring alternative fuels such as liquefied natural gas (LNG), biofuels, hydrogen 
  • Bypassing the Mediterranean 

These options come with their own challenges.  

Ships fitted with open-loop scrubber system need to adhere to local regulations on the discharging of their scrubber wash water. 

Meanwhile, the use of separate fuels requires intensive crew training to ensure proper segregation and flushing procedures are followed to avoid stability issues and cross contamination.  

In the past year, vessel traffic by the Mediterranean Sea has reduced – a consequence of the sporadic Houthi attacks along the Bab-el-Mandeb strait. 

Rystad Energy analysis found that in the first four months of 2025, large tankers such as VLCC’s and Suezmaxes comprised only 10% of vessels using the Mediterranean Sea.  

Vessels opt for the longer Cape of Good Hope route over the lofty risk premium of taking the Red Sea.  

This indicates that the majority of the ships operating in the region are smaller vessels that are most likely already using MGO as fuel.  

MGO bunkering has already been on the rise, signaling a likely increase in use of this fuel as regulations tighten. 

Based on bunkering data from the Port of Rotterdam, MGO bunkering has increased by 67,000 barrels per day (bpd) from the third quarter of2024 to the first quarter of2025, while VLSFO dropped by 48,000 bpd in the same period. 

The capability to produce ULSFO in the region, and in the broader European continent, is limited by a lack of refining complexity.  

ULSFO may be imported from other regions such as the Middle East into entry and exit points of the Mediterranean, such as the recent ULSFO deliveries from the UAE to Turkiye. 

Additionally, Rystad sees HSFO demand to be steady with potential upside as economics heavily favor the use of scrubbers over the more expensive ULSFO leading to a slow but steady rise in availability of scrubber-fitted vessels.

 

Photo credit: CHUTTERSNAP from Unsplash
Published: 30 April, 2025

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Alternative Fuels

Yang Ming orders six LNG dual-fuel, ammonia-ready containerships from Hanwha Ocean

Each of the six new vessels will have a capacity of up to 13,650 TEU and feature LNG dual-fuel propulsion and Ammonia Fuel Ready specifications.

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Yang Ming orders six LNG dual-fuel, ammonia-ready containerships from Hanwha Ocean

Taiwanese shipping firm Yang Ming Marine Transport Corporation (Yang Ming) and South Korean shipbuilder Hanwha Ocean on Wednesday (2 September) signed a shipbuilding contract for six 13,000 TEU class LNG dual-fuel container vessels. 

The contract was signed by Dr. Chuck Tsai, Chairman of Yang Ming, and Mr. Charles Kim, CEO of Hanwha Ocean. The vessels are scheduled for delivery between 2028 and 2029. 

They will complement Yang Ming’s existing fleet of 10,000+ TEU vessels and serve as key vessels on East-West services, with deployment flexibility across trade lanes connecting Asia with the East and West Coasts of North America, South America, and the Mediterranean. 

Each of the six new vessels will have a capacity of up to 13,650 TEU and feature LNG dual-fuel propulsion and Ammonia Fuel Ready specifications.

“As Yang Ming transitions toward net-zero emissions, LNG provides a relatively mature and economically viable alternative fuel solution, capable of reducing greenhouse gas emissions by approximately 20%,” the company said. 

“At the same time, ammonia can serve as a carbon-free fuel by utilising converted LNG storage facilities, while offering relatively lower conversion costs and comparatively well-developed supply chains and infrastructure. The Ammonia Fuel Ready design will therefore provide Yang Ming with greater flexibility in responding to increasingly stringent international regulations on greenhouse gas emissions.”

In addition, the vessels will be equipped with Type B LNG fuel tanks with a design pressure of 1.0 bar to enhance the safety and efficiency of LNG operations, together with a range of energy-saving technologies, including Wind Shields, Rudder Bulbs, Pre-Swirl Stators, and Shore Power Systems. Smart ship technologies and cybersecurity protection features will also be incorporated to enhance operational efficiency, safety, and reliability while effectively reducing fuel consumption and greenhouse gas emissions.

Deliveries under Yang Ming’s next-generation fleet optimization plan commenced earlier this year. By 2030, a total of 24 new vessels are expected to enter service. 

This includes 18 LNG dual-fuel vessels—comprising five 15,500 TEU, seven 16,000 TEU, and the six 13,000 TEU vessels under this contract—alongside six 8,000 TEU methanol dual-fuel-ready ships. 

 

Photo credit: Yang Ming Marine Transport
Published: 4 September, 2026

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Alternative Fuels

LR, China’s MARIC unveil tanker concept ready for three future bunker fuels

Both secured AiP for a new 114,000 DWT product and crude oil tanker designed to accommodate future conversion to LNG, methanol or ammonia.

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LR, China’s MARIC unveil tanker concept ready for three future bunker fuels

Lloyd’s Register (LR) and the Marine Design and Research Institute of China (MARIC) on Thursday (3 September) have secured Approval in Principle (AiP) for a new 114,000 DWT product and crude oil tanker designed to accommodate future conversion to LNG, methanol or ammonia.

Announced at SMM 2026, the concept addresses one of the biggest investment challenges facing shipping today: the need to develop vessels and capabilities that can support a range of alternative fuel options and pathways as technologies, infrastructure and regulations evolve.

While LNG is already a mature fuel pathway, methanol and ammonia remain at an earlier stage of development, with questions around global fuel availability, infrastructure development, economics and long-term adoption.

The 114,000 DWT tanker concept has been designed as a product and crude oil carrier that can accommodate future conversion to LNG, methanol or ammonia as technologies, regulations and fuel supply chains mature. By incorporating conversion readiness at the design stage, the concept aims to reduce future retrofit complexity and provide owners with greater confidence when planning long-term fleet investments.

The design concept was reviewed against LR’s July 2026 class rules and regulations, including requirements relating to ships using gases and other low-flashpoint fuels, alongside relevant IACS Common Structural Rules for oil tankers. Final classification and statutory approval remain subject to full compliance with all applicable rules and regulations.

Theo Kourmpelis, Global Business Director for Tankers, Lloyd’s Register, said: “Shipowners are being asked to make major investment decisions today despite continued uncertainty around which fuels will dominate in the decades ahead. Alternative fuel solutions each offer potential pathways to compliance, but fuel infrastructure, regulation and economics continue to evolve at different speeds around the world.

“Designs that preserve flexibility will be critical in helping owners manage risk while preparing for multiple future scenarios.”

Si Nan, Marine & Offshore Marketing Department Vice Director, MARIC, said: “As the industry explores different decarbonisation pathways, shipowners need vessel designs that can adapt alongside technological and regulatory developments. This concept was developed specifically to provide greater fuel flexibility and long-term resilience, allowing owners to respond to changing market requirements without being locked into a single fuel strategy.

“Receiving Approval in Principle from Lloyd’s Register is an important milestone that validates the design concept and supports its future development.”

 

Photo credit: Lloyd’s Register
Published: 4 September, 2026

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Alternative Fuels

DNV: Alternative-fuelled vessel orders hit highest monthly level since October 2024

LNG-fuelled vessels accounted for the vast majority of August activity while the strong summer performance marked a significant acceleration in ordering activity after a relatively slow start to the year.

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DNV: Alternative-fuelled vessel orders hit highest monthly level since October 2024

Latest data from classification society DNV’s Alternative Fuels Insight (AFI) platform alternative-fuelled vessel ordering was strong in August, with 52 new vessels added to the platform.

This is the highest monthly total since October 2024 and follows another active month in July, when 47 vessels were added to the database.

LNG-fuelled vessels accounted for the vast majority of August activity, with 46 orders recorded. The container segment led the way with 30 orders, while the car carrier segment contributed a further 12 LNG-fuelled vessels. In addition, four ethanol-fuelled bulk carriers and two hydrogen-powered bulk carriers were added during the month, as well as one LNG bunker vessel.

The strong summer performance marked a significant acceleration in ordering activity after a relatively slow start to the year. In total, 242 alternative-fuelled vessel orders have been placed in the first eight months of 2026, representing a 27% increase compared with the same period in 2025.

LNG remains the dominant fuel choice, accounting for 63% of all alternative-fuelled vessel orders registered so far this year. Container vessels represent the largest share of these LNG orders (59%), followed by car carriers (30%).

Jason Stefanatos, Global Decarbonization Director at DNV Maritime, said: “The past two months have been particularly strong for alternative-fuelled vessel ordering, with August recording the highest monthly total we’ve seen since October 2024. This has helped lift year-to-date orders to a level well above the same period last year.

“LNG remains the leading fuel choice, driven largely by activity in the container and car carrier segments. These sectors have been among the earliest adopters of alternative fuels, supported by predictable liner operations and increasing demand from cargo owners to reduce emissions across supply chains. 

“For many owners, LNG offers a combination of emissions reductions, fuel availability and future flexibility while the longer-term fuel landscape continues to evolve. 

“At the same time, the latest figures include orders for ethanol- and hydrogen-fuelled vessels, highlighting that owners continue to explore a range of decarbonization pathways. Different segments are making different fuel choices, but the overall level of activity demonstrates continued investment in lower-emission shipping.”

Screenshot 2026 09 04 at 12.29.26 PM Screenshot 2026 09 04 at 12.29.36 PM

 

Photo credit: DNV
Published: 4 September, 2026

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