- The global bunker fuel market is experiencing a sharp divergence. Conventional bunker fuel prices have plummeted due to falling crude oil costs, while LNG prices have surged due to increased demand and supply constraints.
- This widening price gap between conventional and alternative fuels is creating challenges for shipowners.
The price of conventional bunker fuels, such as High Sulfur Fuel Oil (HSFO) and Very Low Sulfur Fuel Oil (VLSFO), has experienced a significant decline due to the plummeting cost of crude oil, the primary component in bunker fuel production.
LNG Prices Surge
Conversely, LNG prices have surged driven by increased demand, particularly in regions experiencing colder weather or industrial growth. Supply constraints, such as production issues at certain LNG facilities, have exacerbated the upward price trajectory.
Widening Price Gap
This divergence between conventional bunker fuels and LNG has widened the price gap between these fuel types in key bunkering hubs. Shipowners now face the challenge of balancing lower-cost conventional fuels against LNG’s potential environmental benefits and long-term outlook.
Market Outlook
The evolving bunker fuel market makes it necessary to carefully evaluate fuel options carefully, considering factors beyond price, such as environmental impact, fuel availability, and future regulatory trends.
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Source: Engine Online
