Tentative Bunker-Industry Confidence After COVID-19 Crisis: IBIA Conference

Credit appears to be the main concern for the bunker industry in 2021. File Image / Pixabay

The bunker industry is starting to raise its hopes for a more successful 2021 after the nadir of last year's COVID-19 crisis, according to panelists at this week's IBIA conference.

A selection of industry leaders on the 'Coping with COVID-19' panel at the IBIA event on Monday painted a picture of an industry that has come out of last year's crisis with surprisingly little damage.

Total bunker volumes at the world's biggest hubs dropped by just 6.1% on average last year, according to Ship & Bunker's market survey conducted in conjunction with consultancy BLUE Insight. This is despite the near-total disappearance of the cruise industry from the bunker market, which would in a normal year take up around 4% of global demand.

Speaking under Chatham House rules, IBIA's panelists stressed that some areas of the world had seen much bigger drops in volumes, with Asia overall growing its market share at the expense of other markets, and demand generally consolidating at the hubs, but noted that the global recovery could be sharp this year with healthy demand from the container industry in particular.

Credit appears now to be the main concern in 2021, with this year's rapid rise in prices bringing back the fears some had before the IMO 2020 transition of high VLSFO prices putting a limit on how much business some smaller companies could do.

But with Brent crude prices hovering in the $60-65/bl range for now, these concerns have not yet become pressing.

Three more panels with live question and answer sessions will be broadcast at the IBIA conference on Tuesday: the first on alternative fuels, followed by one on digitalisation and another on credit risk.