EMEA News
Loss of Demand Leaves 0.5% in Tanks: Market Sources
Bunker trading in European markets is down by up to a third compared to normal activity but physical demand remains steady.
Speaking to Ship & Bunker, bunker market sources say the drop off in demand from the covid-19 crisis ranges from 15% to 30% on a rule-of-thumb basis.
Traders are also seeing a growing price differential between very low sulfur fuel oil and marine gas oil.
"There's a lot of 0.5% in the tanks so people need to dump it," a source said.
The fall off in bunker trading activity while anecdotal chimes with the current macro view of the overall impact of the pandemic on the economic output of the OECD states.
According to shipping analyst Shipping Strategy, the loss of consumer demand could be around a third.
"In the West, where consumer spending makes up over two thirds of economic activity, the effects of quarantine and nationwide lock-down will be greater. Up to 30% of OECD economic output could be lost in the second quarter of this year," analyst Mark Williams said in an industry note.
About Julian Macqueen
Julian is Ship & Bunker's Senior Editor and has over 20 years' experience covering the maritime and energy industries. In addition to being the editor of the Oxford-based Bunkernews in the late nineties, his career has included appointments at Lloyd's List, Tradewinds, Bunkerworld, and S&P Global Platts.
Julian is based in London, UK.
About Ship & Bunker
Ship & Bunker is the world's most read publication focused on the marine fuel markets. Completely independent, it is the leading industry authority providing comprehensive daily news, exclusive in-depth features and analysis, along with daily & historical bunker price indications.
To contact the editor responsible for this story email us at editor@shipandbunker.com
