Upcoming announcement on 'the green side of bunkering'
Sales in Singapore and Fujairah stand at about 200,000 mt/month each
No plan to buy up Grindrod's half of Cockett Marine Oil
The firm has ramped up bunker sales in Singapore and Fujairah in recent months. File Image / Pixabay
Commodity trading giant Vitol has made a significant statement of intent this week in establishing its new global marine fuels brand, Vitol Bunkers.
The firm announced plans on Wednesday to follow rival traders Mercuria and Trafigura in seeking to take a much more active role in the bunker market -- Mercuria having added the remnants of Aegean Marine Petroleum to its Minerva Bunkering unit in 2019, and Trafigura having set up TFG Marine with shipping firms Frontline and Golden Ocean at the end of that year.
New Bunkering Platform
Vitol Bunkers will not have its own CEO, but Chris Young -- previously in charge of Vitol's marine fuel sales in Fujairah -- will serve as its global account manager. Young set out the company's plans in an interview with Ship & Bunker on Thursday.
"What we've tried to do is put Vitol Bunkers as its own brand within the Vitol group," Young said.
"Over the next 12 months or so, you'll see us entering different ports, different parts of the bunker business, and you'll just see us grow.
What we've done yesterday ... is put the platform down.
"So what we've done yesterday, really, is put the platform down."
Vitol already has a significant presence in the global bunker market.
The firm's Singapore marine fuels unit was listed as the city-state's 10th-largest bunker supplier by volume last year after Vitol took over Sinanju Tankers Holdings and renamed its Singapore unit. Sinanju had been the 14th-largest supplier on the list in 2019.
In Fujairah the company operates an 80,000 b/d refinery that is a key producer of VLSFO in the Middle East.
Vitol also owns half of bunker trading firm Cockett Marine Oil.
The company intends to make an announcement in the coming weeks on its plans for 'the green side of bunkering', Young said, without revealing which alternative fuels or technologies the firm will be concentrating on.
We're looking at the green aspects of bunkering going forward.
Several bunker suppliers and traders -- including Peninsula, Fratelli Cosulich, TFG Marine, Bunker One and GAC Bunker Fuels -- have made moves in recent months to establish a foothold in the alternative bunker fuel market.
"Something's going to come out in the next few weeks to explain the Vitol presence in that," Young said.
"All I would say at the moment is we're looking at the green aspects of bunkering going forward, as I'm sure many other companies are."
One of Vitol's first sales strategies will be to increase its work with the companies with which it already does business, Young said.
"We charter a lot of vessels worldwide, and some of the companies we charter from, we don't work with for various reasons, and we're going to try and put that right," he said.
We've already ramped up our volumes in Singapore and Fujairah.
"We obviously work with the Shells, the BPs, the Maersks and other big container lines, the big tanker companies.
"We're also going to maybe look at the cruise ships, if they come back -- we might look at that segment in various parts of the world.
"We've already ramped up our volumes in Singapore and Fujairah over the past three to four months."
The company expects to sell about 200,000 mt of marine fuels in Fujairah this month, out of a total market that it assesses at about 650,000 mt/month.
In Singapore the company should also sell more than 200,000 mt this month, Young said. The Maritime and Port Authority posted Singapore's total sales for April at 4.3 million mt.
No Change for Cockett
Nothing has changed in how Cockett's being run, or how it will be going forward.
No change should be expected for the status of Cockett Marine Oil, Young said. Vitol owns half of the firm, and the owner of the other half, South Africa's Grindrod, recently reiterated that its stake is up for sale.
"Cockett is a standalone business and has always been run like that," Young said.
"There is no plan that I'm aware of that we will be considering taking over Grindrod's role in that."
Vitol also has no plan to sell its half of the firm, Young said, and it will also not be using its stake to push customers towards Vitol as a supplier preferentially.
"Nothing has changed in how Cockett's being run, or how it will be going forward," he said.
"It's always been a separate entity."