World News
Taiwan's Early Adoption of 0.5% Sulfur Cap Unsettles Shipowners
In what could be a portent sign, shipowners using Taiwanese ports are concerned at the higher fuel prices they will face in advance of the 2020 global 0.5% sulfur cap on marine fuel.
Citing market sources, price reporting agency Platts said Taiwan's decision to implement the 0.5% cap from next year has caused consternation among shipowners who will need to use low sulfur fuel when in Taiwanese waters.
A shipowner quoted by Platts said:"Not many people are providing low sulfur fuel oil, so people will likely use marine gasoil, which costs $350-$400 more per mt. An aframax tanker discharging uses 90 mt of mgo to shift between the outer and inner anchorage."
At the Taiwanese port of Kaohsiung, for example, 380 CST bunker fuel, which has 3.5% sulfur, is today $429.5 per metric tonne (mt) while marine gasoil comes in at $705.5/mt making the latter cost over 60% more, Ship & Bunker prices show.
Subsidies are available this year to mitigate the higher cost to shipowners and operators opting for low sulfur bunker fuel.
Observers of the global bunker industry expect a period of price volatility to take hold across markets from the start of 2020.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 647.50 | 1.00 | 770.00 | 3.50 |
| Rotterdam | 601.50 | 2.50 | 754.00 | 2.00 |
| Houston | 619.00 | 11.50 | 795.50 | 3.00 |
| Fujairah | 651.50 | 1.00 | 895.00 | 2.00 |
| Global 20 Ports Average | 664.00 | 1.50 | 856.50 | 2.00 |
| Global 4 Ports Average | 630.00 | 3.00 | 803.50 | 2.50 |
| Global Average Bunker Price | 718.00 | 0.50 | 914.50 | 0.50 |
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