S&B ANALYSIS: HSFO Surge Sends Singapore Bunker Sales to 11-Month High

Last month's total was the highest since October 2021. Image Credit: Ship & Bunker / Data Credit: MPA

Bunker demand in Singapore, the world's largest marine fuels hub, jumped to the highest level in nearly a year last month as HSFO sales surged.

The city-state's total demand reached 4.3 million mt in October, according to preliminary data from the Maritime and Port Authority. The total was down by less than 0.1% from the same month a year earlier, but up by 7.1% from September's level and the highest monthly total since October 2021.

The total had slipped by 3.6% on a monthly basis in September.

Singapore's total for Q3 came to 12.2 million mt, the highest level since Q4 2021.

Product Breakdown

VLSFO sales rose by 4.6% on the month to 2.6 million mt in October, HSFO surged by 17.6% to 1.3 million mt, distillates fell by 5.8% to 316,200 mt and other fuels dropped by 13.3% to 37,100 mt.

HSFO's share of the total was 30.8%, up from 27.8% the same month a year earlier.

The niche LNG bunker market in Singapore continues to grow, after seeing total sales of 50,000 mt last year, but LNG sales are not yet being included in the monthly figures. Biofuel blend sales are also being carried out -- reaching a total of about 70,000 mt in January to September of this year -- but are not included in the official data.

Strong Start to Q4

October's total showed a strong start to Q4's figures after Singapore's Q3 total hit the highest quarterly level since the fourth quarter of 2021, with the market improving after persistent weakness earlier on in 2022. Singapore's first-half total was the lowest since the first half of 2015, undermined by COVID lockdown effects in Asia, the HSFO contamination problem in February and March and supply issues caused by the Russia-Ukraine crisis.

Renewed concerns over COVID-19 in Asia and a sharp drop in container freight rates appear not to be playing into bunker demand figures yet.

There were 3,431 vessel calls for bunkers in October, 8.8% higher than the level seen a month earlier and the most since April 2021. That left the average stem size last month at about 1,239 mt, compared with the 12-month average of 1,277 mt.

Prices

Singapore's average VLSFO price in October was $724.50/mt, according to Ship & Bunker data, up by 4.8% from September's level and by 19.5% from the level seen a year earlier. Ship & Bunker's G20-VLSFO Index of average prices across 20 leading bunkering ports gained 1% on the month and 27.6% on the year to $750/mt in October.

Boxship Visits Climb

Calls from container ships were the biggest rising segment in October. Image Credit: Ship & Bunker / Data Credit: MPA

The total gross tonnage visiting Singapore jumped by 9.2% on the year to 251.2 million mt, the highest level since January 2021. This advance was led by the container segment, where calls by gross tonnage gained 8.2 million mt. Tanker tonnage calls rose by 5.9 million mt, while bulkers rose by 6.6 million mt.

The mandatory mass flow meter systems used to measure all bunker deliveries in Singapore come with a +/-0.5% margin of error, a level considered more accurate than traditional measurement systems used at most other ports with the added benefit of all but eliminated volumetric malpractice.

Only licensed companies can supply bunkers in Singapore, and the MPA calculates sales based on the bunker delivery notes of those companies.