The following article is part of pre-event coverage for the upcoming Singapore International Bunkering Conference and Exhibition (SIBCON) 2020; where Manifold Times is an official media partner:
Analysis of big data by international fuel testing and inspection company Veritas Petroleum Services (VPS) have uncovered a link between a spike of low flashpoint off-spec cases for marine gas oil (MGO) and Coronavirus Disease 2019 (Covid-19) developments.
In May, VPS identified 95 occasions where MGO bunker samples were below the 60°C flash point requirement as mandated by the International Convention for the Safety of Life at Sea (SOLAS), according to Dr Malcolm Cooper, VPS Group Managing Director.
“This was investigated due to the serious health and safety risk posed to the ship’s crew and the non-compliance with the SOLAS Convention,” he told Manifold Times.
VPS graph showing trend of % of low flash-point off-spec MGO
Dr Cooper noted governments introducing Covid-19 related lockdown measures earlier in 2020 to limit spread of the virus – a decision which adversely affected global aviation and land transportation industries.
The development resulted in a significant surplus of road and aviation transport fuels on the market and also a decline of prices for the fuels (as shown by Refinitiv data below).
This provided commercial impetus for road and aviation fuels, both of which have lower flashpoints than MGO, to be blended into bunkers; thereby increasing the occurrences of low flashpoint off-spec cases for MGO.
Further, the current low prices for road and aviation fuels in September could mean another increase of flashpoint off-spec cases for MGO when players start introducing the products back into the bunker stream, he suggests.
Refinitiv price data for jet fuel, diesel and gasoline
“The Covid-19 pandemic has clearly had an extremely damaging effect on human health but it has also substantially impacted marine fuel supply chains and deliveries and hence product quality,” explained Dr Cooper.
“It is likely that some of this surplus diesel and kerosene has reached the marine fuel supply chain given the complex route from refinery to final product.
“By applying data analytics, there is a clear correlation between the spike of low flashpoint off-spec bunker fuels with the availability of road and aviation fuel.
“The application of data analytics to good quality data provides a useful insight into how VPS is now providing a commercial offering to the market capable of helping the user to optimise fuel costs and greenhouse gas emissions.”
Photo credit: Veritas Petroleum Services, Refinitiv
Published: 23 September, 2020
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U.S. Claims Register Summary recorded a total USD 833 million claim from a total 180 creditors against O.W. Bunker USA, according to the creditor list seen by Singapore bunkering publication Manifold Times.
Glencore purchased fuel through Straits Pinnacle which contracted supply from Unicious Energy. Contaminated HSFO was loaded at Khor Fakkan port and shipped to a FSU in Tanjong Pelepas, Malaysia to be further blended.
Individuals were employees of surveying companies engaged by Shell to inspect the volume of oil loaded onto the vessels which Shell supplied oil to; they allegedly accepted bribes totalling at least USD 213,000.
MPA preliminary investigations revealed that the affected marine fuel was supplied by Glencore Singapore Pte Ltd who later sold part of the same cargo to PetroChina International (Singapore) Pte Ltd.
‘MPA had immediately contacted the relevant bunker suppliers to take necessary steps to ensure that the relevant batch of fuel was no longer supplied. Further investigations are currently on-going,’ it informs.
