0.5% Sulfur Fuel Oil Most Likely Choice for Bunker Buyers in the Americas: Argus

Tuesday September 12, 2017

Bunker fuel with a with a 0.5% sulfur content will be the most like choice for ships looking to stem at ports in the Americas come 2020, according to price-reporting agency Petroleum Argus.

At an Argus bunker briefing held during London's International Shipping Week, Argus editor Stefka Wechsler based her assessment on the dictum that whatever the major box lines do, the rest will follow.

And the indications are that the big shipping lines will take this direction.

But for bunker markets in the Americas the outlook will be mixed.

2020 will see higher demand for distillates. In the Americas, the US East Coast along with Venezuela, Colombia and Ecuador will be 'poorly positioned' for 2020 as these markets are short on distillates.

In contrast, the US West Coast, which has a more balanced market in distillates, will be in a better position to benefitfrom the changes, she said. 

In the US market, marine distillate demand will double from 4% to 8% but as demand from the road surfacing industry forms the biggest slice of overall fuel oil demand, it will be the sector that continues to drive price, Wechsler said.

Argus editor Jonathan Weston said that globally, heavy fuel oil would still comprise 30% of the marine fuel mix after 2020. The market share taken by marine gasoil will increase to 100 million metric tonnes while the surplus of high sulfur material will be around the same margin.