U.S. Uptake of 0.1%S ULSFO Remains Low

by Ship & Bunker News Team
Wednesday February 11, 2015

Five weeks on from the start of stricter Emissions Control Area (ECA) sulfur limits, interest form buyers in ultra-low sulfur fuel oil (ULSFO) bunkers in the U.S. remains low, Platts reports.

In January, there were reports that U.S. players had been slow to purchase ULSFO bunkers in order to comply with new ECA rules, given the low price of the better known marine gasoil (MGO).

But recent price increases for MGO have done little to entice buyers to ULSFO, according to trading sources.

According to the report, suppliers including Atlantic Gulf Bunkering, Peninsula, Shell, Glencore's Chemoil, and others are offering ULSFO at discounts of up to $50 per metric tonne to the MGO price.

"There is not much interest in this ULSFO max 0.1% anywhere," said one veteran bunker fuel trader.

"Prices have fallen so much that, unless Brent hits $100/bbl again, the vast majority of buyers will most likely stick with diesel."

A U.S. Gulf Coast supplier said "with the current market conditions, most of the shipping companies are reluctant to take a financial risk on this new product."

While uptake is lacklustre in U.S. markets, suppliers are expanding their offering elsewhere.

In January, ExxonMobil expanded its supply of HDME 50 to Hamburg.

Ship & Bunker News Team
To contact the editor responsible for this story email us at editor@shipandbunker.com