Americas News
Cruise Season Pushes Up MGO Demand, Prices in Vancouver
The start of Vancouver's cruise season has pushed up demand, and prices for Marine Gas Oil (MGO) in the Canadian West Coast port, Platts reports.
The 2015 season started in earnest in April, and data from Ship & Bunker shows the average price of MGO for the month was $735.50 per metric tonne (pmt).
In May, that rose to $799.50 pmt.
The Vancouver - Singapore MGO spread also widened $44 in that time, from $181 on April 1 to $225 at the end of May.
"[Cruise demand] adds 50 percent extra demand from May-September," a Vancouver-based source told Platts.
It is understood that by the time the cruise season begins, inquiries are generally closed and product is supplied on a term contract basis.
However the demand that the cruise market makes on overall supply reduces the amount of product available in the spot market.
New Emissions Control Area (ECA) regulations introduced on January 1, 2015 "have really increased demand," according to one Platts source, who added that they anticipated MGO prices continuing to climb over the remaining four months of the cruise season.
However a separate source was less certain.
"These days markets go up and down like crazy," they said.
Last week Aegean Marine Petroleum Network Inc. [NYSE: ANW] (Aegean) said it more than doubled its operational capacity in Vancouver with the introduction of a state of the art, double hull newbuild bunker barge.
