ANALYSIS: Average VLSFO Bunker Prices at Key Ports Fall 20% in 2025

Bunker prices generally trended downwards throughout 2025. Image Credit: Ship & Bunker

• G20-VLSFO Index ended 2025 down 20.4% from end-2024
• Average VLSFO price for 2025 was $535/mt, 14.4% lower thanthe $626/mt witnessed in 2024
• MGO saw a smaller 7.1% average decline in 2025 as middle distillate markets outperformed fuel oil
• $94 EU-ETS cost increase for intra-EU VLSFO use outweighed $91/mt decline in VLSFO price

Global bunker prices dropped sharply in 2025 in a year characterised by intense geopolitical turmoil driving volatility in oil prices.

Ship & Bunker's G20-VLSFO Index of prices at 20 key bunkering locations ended the year at $463.50/mt, down by 20.4% from the level seen a year earlier.

2025's average G20-VLSFO price was the lowest since 2020. Image Credit: Ship & Bunker

Its average price for the year was $535/mt, down by 14.4% from 2024 and the lowest since 2020. That yearly drop was the third-largest in the seven years since the VLSFO market first emerged at scale, beaten by 2023 in second place with a 23% decline and 2020 in the lead with a 35% drop.

The G20-HSFO Index saw a more mixed performance for the year in comparison, with its final price of 2025 of $391/mt down by 22.7% from end-2024 and its average price of $461/mt down by 10.5% on the year. 

The G20-MGO Index saw much less steep declines, with its final price of $715/mt down by 6.7% from end-2024 and its average price of $754/mt down by 7.1% on the year.

VLSFO's highest point for the year was $621/mt in January, and its low point was $456/mt in December. HSFO's highs and lows for the year were $533/mt and $382/mt, seen in the same months, while MGO's were $822/mt and $693/mt, seen in November and May respectively.

The average G20 scrubber spread was $74/mt in 2025, down by 32.7% on the year. The high point of the year for the scrubber spread was $101.50/mt, seen in January, and the low point was $52/mt in October.

In the past a scrubber spread of at least $100/mt was seen as a key level above which investments in the emissions-cleaning systems were economically viable. But with most scrubber investments now having paid off their capital cost, this threshold is much less psychologically significant for the market.

Geopolitical Waves

For the oil markets the year was dominated by geopolitical headlines, many of which originated from actions of the new Trump Administration in the US.

Trade tensions over the new president's tariff agenda drove a sharp decline in prices in April, with some of this recovered over the next two months.

Strikes on Iran by the US and Israel in June saw a brief spike in the market, but one that largely reversed itself over the next few months as the aftermath proved to be less volatile than had initially been feared.

Strikes by Ukraine on Russian oil infrastructure helped to drive a jump in middle distillate prices -- boosting MGO -- in October and November, but these markets resumed their downward trend by December. 

Underlying all of these temporary issues was the longer-term trend of oversupply in the crude market, with production increases from OPEC+ members far outpacing demand and driving forecasts of sharply lower oil prices in 2026. This trend was partially tempered by crude inventory builds in China, but not sufficiently to reverse the decline.

Rising Decarbonisation Costs

For marine energy prices another important factor in 2025 was the increasing relevance of emissions compliance to cost calculations.

As well as the launch of the FuelEU Maritime regulation, 2025 also saw a stepping-up of the EU Emissions Trading System for shipping.

For 2025 shipping firms were required to surrender European Union Allowances (EUAs) to cover 70% of the emissions generated on intra-EU voyages, up from 40% the previous year. The deadline to surrender allowances for each reporting year comes in the following September.

This regulatory tightening was combined with a rise in prices for the allowances and a weakening of the dollar against the euro. The EUA price in dollars averaged $84/mtCO2e in 2025, up from $72/mtCO2e a year earlier.

That meant each tonne of VLSFO consumption on an intra-EU voyage in 2025 generated $185 of EU-ETS compliance costs, just over double the $91 average cost in 2024. With the G20-VLSFO Index losing $90/mt last year, that means the increase in EU-ETS costs in 2025 outweighed the decline in VLSFO prices for ships on intra-EU voyages.