Overview  |  Methodology  |   Individual Market Volumes & Commentary

Overview

Demand at marine fuel hubs sank by 9.3% overall in the second quarter of 2020 at the peak of the COVID-19 crisis, according to a market survey of bunker sales volumes in 16 leading global bunkering locations.

The study, conducted by Ship & Bunker in conjunction with consultancy BLUE Insight, took place over the summer of 2020 and surveyed bunker market participants around the world.

The survey results tally with Ship & Bunker analysis from March estimating that the impact of the COVID-19 pandemic might reduce demand by 8%.

The study found the decline was much sharper in some parts of the world, with overall rising demand in certain Asian markets cushioning weakness elsewhere.

"Concern over the impact of the new 0.50% sulfur cap was discussed for years before its introduction on January 1, and the latter part of 2019 and beginning of 2020 indeed saw significant volatility because of the new rules. But in Q2 COVID-19 quickly replaced IMO 2020 instability as the key market driver," says Martyn Lasek, Managing Director, Ship & Bunker.

"The second quarter was pretty depressing," added Adrian Tolson, director of BLUE Insight.

"Although there appears to be resilience in some of the key bunkering ports in the world, particularly those that have benefited from container service consolidation like Singapore and the ARA.

"It seems, as we suspected, that the smaller ports would suffer more than bigger ports."


Methodology

Very few ports release detailed bunker sales volume data, Singapore is perhaps the best known for its regular, detailed monthly updates of sales figures. It also stands alone in backing up that data with a rigorous bunker licensing scheme and mandatory use of mass flow meters (MFMs) for its suppliers. Panama, Rotterdam, LA/Long Beach and Turkey are among other markets where some official data is available. In the majority of cases where official data was not available, Ship & Bunker and BLUE Insight surveyed bunker market participants around the world including physical suppliers, brokers, and traders active in the respective markets.

The areas covered by the survey are Singapore, the Amsterdam-Rotterdam-Antwerp hub, Fujairah, the US Gulf, South Korea, the Gibraltar Strait, Hong Kong, Panama, Zhoushan, Japan, New York, West Africa, the Canary Islands, Los Angeles/Long Beach and Turkey.

Together these areas saw just over 30 million mt of demand in the second quarter. On an annualised basis that would mean these areas cover more than half of the 221 million mt/year the International Energy Agency cites as global bunker demand for 2019.

But because the areas covered by the survey include some of the top bunkering areas in the world, the global decline shown is likely to be less steep than that seen for total demand. The effect of demand tending to congregate at bunkering hubs this year has tended to leave the world's smaller ports suffering more greatly.


Individual Market Volumes & Commentary
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