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Straits Energy Resources Q3 2021 profit increases to RM 1.94 million on bunkering gains

Increase substantially attributed to oil trading & bunkering services segment due to recovery of maritime industry and global oil prices.

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Straits

Malaysia-listed Straits Energy Resources (SER), formerly known as Straits Inter Logistics, posted a rise in profit for the third quarter (Q3) of 2021 mainly due to increased revenue from its oil trading & bunkering services segment.

The group recorded profit before tax of RM 1.94 million in Q3 2021, 53.6% up from profit of RM 1.27 million in Q3 2020.

Its overall revenue grew 111% to RM 341.2 million in Q3 2021.

“The Group’s revenue in the current quarter surged by RM180.0 million to RM341.2 million, from RM161.2 million recorded in the corresponding quarter of the previous year.

“The increase was substantially attributed to the oil trading & bunkering services segment due to the recovery of the maritime industry and global oil prices compared to corresponding quarter,” it explained.

“The revenue from this segment itself increased by RM161.0 million.”

Its oil trading & bunkering services segment, meanwhile, posted a 114.6% on year increase in revenue to RM 337.7 million in Q3 2021, while profit for the similar segment grew by approximately three times to RM 743,000 in the similar quarter.

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Moving forward, SER shares it is looking to widening its business coverage into Ship to Ship (STS) operations. The group in August received a letter of approval from Marine Department Malaysia for the development of STS Energy Transhipment Hub at Labuan.

“The new business is estimated to commence by December 2021 and the Group aims to be a major player in the Sustainable and Alternative Energy industry in addition to its current fuel bunkering and port operation business,” it notes.

“As the COVID-19 pandemic continues to pose challenges to the global business environment since its outbreak in March 2020, the economy outlook remains highly uncertain with the continuous mutation of the COVID-19 virus,” it adds.

“With the majority of the Group’s businesses being classified as essential services, the Group is able to continue operating and concurrently complying with the Standard Operating Procedures to ensure the safety and wellness of its employees and also to ensure the continuous growth and smooth execution of its expansion programs.”

Related: Straits Energy Resources in MOU with Baicells Technologies for 4G and 5G roll out
Related: Malaysia: Straits Energy Resources adds “Empower” to bunkering fleet
Related: Straits Inter Logistics undergoes name change to Straits Energy Resources
Related: Tumpuan Megah Development to collaborate with Petronas for bunker deliveries
Related: Straits Inter Logistics receives government approval to develop STS hub
Related: Straits Inter Logistics subsidiary to become STS operator at Victoria Bay, Labuan
Related: Malaysia: Straits Inter Logistics gears up for USD 3.6 million STS hub project
Related: Malaysia: Straits Inter Logistics posts 26% rise on year in profit for Q1 2021 

 

Photo credit: Straits Energy Resources
Published: 26 November, 2021

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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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Bunker Fuel

Integr8: IEA’s 2030 outlook and what it means for bunker markets

Research Contributor Steve Christy analyses IEA’s oil market outlook to 2030 which he says will shape the bunker market over the rest of this decade.

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The IEA’s 2030 Outlook and What It Means for Bunker Markets

By Steve Christy, Research Contributor, Integr8 Fuels
[email protected]   

25 June 2025

The ‘Oil World’ will start to decline within the next 5 years

With oil prices in turmoil, moving much higher because of US, Israeli and Iranian attacks, and then much lower on what looks like a fragile ceasefire, it is perhaps a good time to take a ‘bigger picture’ look at the direction of the oil industry over the next 5 years. The IEA has just published its oil market outlook to 2030, and there is a lot within this analysis that will shape the bunker market over the rest of this decade.

Importantly, we are moving from an industry that has been growing, to one that will soon be in decline. In the IEA outlook, world oil demand is forecast to show only modest gains over the next 2 years, with minimal gains in 2028/29 and then go into decline in 2030.

graph1 no line

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Petrochemicals and aviation is where the growth is

Looking at the key aspects of the oil products markets over the next 5 years, there are a few high-profile developments taking place. Firstly, there is significant growth in the petrochemical sector, and this will drive higher demand for LPG, ethane, and naphtha.

Secondly, there is also growth in jet demand. This follows the continued increases air travel and transport, and that jet fuel still essentially can only come from an oil refinery.

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Bunker demand is expected to remain flat

Within their analysis, the IEA expects demand for bunkers to remain stable at around 5 million b/d over the outlook period. Their basis is that a 2% p.a. growth in tonne-kilometres demand will be offset by efficiency gains in the shipping industry and IMO regulations supporting some switching to lower emissions fuels, such as biofuels and ammonia.

Oil demand is falling as EVs are increasing

Gasoline and diesel have accounted for around 40% of total world oil demand. The main reason for oil demand starting to decline at the end of the decade is the expansion of electric vehicles (EVs) and the accompanying loss of gasoline and diesel demand in the transport sector.

For us in bunkers, it is the gasoil/diesel and fuel oil sectors that will be most influential.

Substantial changes in the outlook for US & China

Two major changes from last year’s IEA report are that:

  • US oil demand is still forecast to fall, but at a much slower pace (which is not surprising under President Trump’s policies).
  • Oil demand in China will fall much earlier than previously anticipated.

China is now the world leader in EVs in terms of manufacturing and sales. This, along with massive investments in the high-speed rail network and structural shifts in the economy, mean the IEA is now expecting China’s oil demand to start falling within the next 4 years! This is a radical change, with China being the powerhouse behind increases in world oil demand in recent years.

In contrast, before President Trump was elected, the forecast was for US oil demand to fall by 1.5 million b/d between 2025 and 2030. Now, with Trump in power, the IEA has ‘downgraded’ this forecast decline to just 0.45 million b/d

Europe shows the biggest drop in oil demand

The agency has kept its previous expectation for a 0.8 million b/d drop in European oil demand between now and 2030. This means Europe is now at the forefront of changes in oil demand over the next 5 years.

There are no planned refinery closures in Europe after this year, but lower demand in the region will lead to lower refinery throughputs and product availabilities. It is how product balances unfold between cuts in refinery output versus the drop in oil demand; this will impact trade, pricing and how bunker markets are supplied in the region.

Limited changes in the US; but no market can stand alone

The situation in the US may be more balanced given the slower pace at which oil is removed from the energy mix. But we know how markets are ‘interwoven’, and no international bunker market is immune to what is happening elsewhere in the world.

graph3

Latin America & African demand continues to rise

It is by coincidence that forecast declines in demand in Europe and the US are exactly matched by increases in oil demand in the growing economies of Latin America and Africa. This means that oil demand in the Atlantic Basin is expected to be close to current levels in 5 years time. However, with very few new refinery projects in the growth regions, it does stress the need for additional trade volumes to move between areas to achieve regional balances across different product groups. We in bunkers will be affected by these additional trade flows and price implications.

The Middle East not as it seems; its rising

On the face of it, there is a slight decline in Middle East oil demand over the next 5 years. However, once you dig into this, Saudi Arabia’s strategy to stop burning domestic oil for power generation and desalination plants* more than explains the cut. If this is taken out of the equation, Middle East product demand is forecast to increase by around 0.4-0.5 million b/d by 2030.

* part of this is a reduction is in fuel oil use, which could push more of this into the international market.

Nonetheless, the Middle East is one of the key areas where new refining capacity, upgrading and desulphurisation is taking place. Therefore, long haul product exports from the region are likely to continue to increase. This will cover some of the imbalances elsewhere in the world, but will also have price implications.

Asia & China could see the biggest changes for us

Finally, some of the biggest issues hitting the oil and bunker markets are likely to be seen in Asia As outlined, oil demand in China is expected to start falling by the end of the decade. But this is in contrast to what is happening in India and other Asian countries, where a combined growth of almost 2 million b/d is seen between now and 2030.

This is where trade flows, pricing and market influence could be interesting. Despite no growth in Chinese oil demand, there are still a number of refinery capacity additions in the pipeline. There are of course a number of scenarios surrounding these dynamics, but one obvious one is that China becomes an even bigger products exporter over the next 5 years. Again, this will have implications for all the major products, including what happens to us in bunkers.

This report poses more questions than answers

Clearly these are prominent issues for us in the bunker market. Longer term planners in our business will be assessing the potential surpluses and shortfalls by region for VLSFO, blending components and HSFO based on these demand and refining forecasts. It will be interesting to see how trade flows, bunker pricing and China influence our business over the next 5 years.

 

Photo credit: Integr8 Fuels
Published: 26 June, 2025

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