Market Participants See Singapore VLSFO Rising Over Course of Q1

NSI's customers mostly expect Singapore's VLSFO price to rise by the end of March. Image Credit: NSI

Bunker market participants are expecting a rise in prices over the first three months of the year despite forecasts of falls in crude, according to a survey of brokerage NSI's customers.

NSI has surveyed its customers on a range of questions around marine fuel pricing and decarbonisation, it said in an emailed note on Monday. The survey was compiled before the weekend's news of a US-enforced change of government in Venezuela.

Of those surveyed, 36.7% expected the Singapore VLSFO price to land somewhere in the $451-500/mt range by the end of Q1, while another 30% expected it in the $401-450/mt range.

VLSFO delivered in Singapore cost about $430/mt on Friday, according to Ship & Bunker prices.

35.5% of the survey's participants expected Brent crude to be in the $51-60/bl range by the end of Q1, while 22.6% expected it in the $61-70/bl range and another 19.4% in the $71-80/bl range.

ICE March Brent futures closed at $60.75/bl on Friday.

The survey also had a clear majority expecting an increase in market share for biofuels.

Of those surveyed, 64.5% expected biofuels to be the fuel type apart from conventional futures to show the greatest increase in market share in Q1, beating LNG into second place with 22.6% of the vote.

But taking a longer view, the market appears to be more divided on the prospects for alternative fuels. Asked which alternative marine fuel holds the most promise for widespread adoption by 2030, 35.5% chose biofuels, 22.6% methanol, 16.1% LNG, 16.1% hydrogen and 9.7% ammonia.