Asia/Pacific News
Singapore: Is the 8% Drop in July's Bunker Sales Significant?
Industry observers will no doubt be wondering if the 8% year-on-year drop in Singapore's July bunker sales is significant, particularly in light of recent fuel quality problems reported at the port - problems it should be noted in recent months have also plagued other major markets including Houston and Panama.
Indeed, at the end of July, Reuters quoted a Dubai-based bunker trader saying their usual 7-8 daily enquiries had jumped to "more than 17-18 per day" in the face of fuel quality problems surfacing in the Lion City.
Bunker Volumes
While such a shift for monthly sales in year-on-year comparisons is not overly unusual, changes of the magnitude witnessed last month have tended to be positive. Still, year-on-year sales did drop over 6% in June 2017, and some 4% in both May 2017 and March of this year.
But there is no escaping that July's 8% drop is the biggest since May 2013 both in terms of percentage and tonnes.
Then, the fall of 11% was coloured by the fact it was being compared with May 2012's at-the-time record high sales of almost 4 million metric tonnes (mt), a performance it should be recognized was so strong the record stood for over three years.
Volumes for 2013 as a whole showed no impact from the apparent flux and stayed flat at just over 42.5 million mt, the same as they were the year before, and the same as they were in the year after.
Fast forward to July 2017 and this was also a notably strong performance; at 4,393,700 mt it is currently the port's third highest ever monthly sales total.
With 2018 volumes to date in-step with the previous year, there is plenty to suggest we should not read too much into year-on-year volume comparisons for July of this year.
"The 8% drop compared to July last year may look significant but it is worth noting that the delivered volume was back above 4 million tonnes after dipping below that level for the first time this year in June this year, and compared to June this year sales in July were up by almost 3%," Simon Neo, Regional Manager Asia, International Bunkering Industry Association (IBIA) told Ship & Bunker.
Bunker Calls
The number of calls for bunkers is also an important part of the picture, but July 2018's 2.6% year-on-year drop in bunker calls to 3,297 (compared the 3,386 during July 2017) is not anything out of the ordinary.
Further, it is well in-line with the trailing 12-month average of 3,299 calls for bunkers.
"It is also worth noting that shipping volumes in our region have been falling in the past few months; according to MPA statistics, total Singapore vessel calls in July were down by about 5% from last year. However, vessel calls for bunkers were only down by about 2.6% year-on-year so the number of vessels taking bunkers in Singapore relative to overall vessels calls was in fact healthy; they just took smaller average stems," said Neo.
"Inevitably, there will be some speculation that the drop in Singapore's bunker sales is linked to the instances of contaminated fuel oil that have been reported in Singapore since June this year. From what we have heard, some shipowners have thought twice about lifting bunkers in Singapore because of this, with a few saying they would avoid it temporarily, but for the most part owners have continued stemming their bunkers here."
