US Players Report Slow Uptake of 0.10% ULSFO Product

by Ship & Bunker News Team
Friday January 23, 2015

Shipowners are mostly opting to use marine gas oil (MGO) for North American Emission Control Area (ECA) compliance despite the availability of lower cost 0.10 percent sulfur ultra-low sulfur fuel oil (ULSFO) alternatives, Platts reports.

Ship & Bunker market sources indicate ULSFO in the U.S. currently carry a discount of around $25 per metric tonne (pmt) compared to 0.10 percent sulfur MGO (LSMGO).

According to the report, sources said MGO use carried less less risk, as the relatively new low-sulfur fuel alternatives are made by a variety of companies, with each supplier's product differing in viscosity, API, acidity, and sulfur content.

Even though best practice is to always keep fuel mixing to a minimum, one source said additional caution is advised when handling the new products.

That could mean taking steps ranging from tank cleaning through to installing additional equipment, the cost of which, according to an Atlantic Coast based supplier, is "not worth the investment at this time."

In addition, the continued decline in oil and bunker prices has also been a depressor for MGO prices, reducing the need for owners and operators to consider even cheaper fuel. 

Beginning January 1, 2015, marine fuel used in ECAs is limited to a sulfur content of 0.10 percent by weight.

It was reported last November that the anticipation of ECA deadlines had begun driving MGO demand in Northwest Europe since October. 

Ship & Bunker News Team
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