Various consultancy and statistical analyses organizations and some major shipping companies are making their predictions/projections on the pricing of the new 2020 fuels. Viswa Lab in its latest technical update briefs about the same.
Predictions may impact scrubber decisions
Argus media says that the differential between High Sulfur Fuel and Low & Ultra Low Sulfur Fuel, currently around $260‐$270/ MT is likely to go up to $470/MT.
EuroNav which owns 72 vessels including several ULCCs, states for VLSFO purchase it paid a premium of only $47/MT over the HSFO prices.
This small price differential is somewhat surprising. If this is the long‐term projection, it could make a significant impact on scrubber purchase decisions.
Differential pricing spike projected
However, it has to be noted that this is the current price based on current availability and market demand.
Almost every fuel consultancy organization project a huge spike in the differential pricing come 1.1.2020. This is expected to last for at least 2 years before equilibrium situation is reached.
Blending expert Mr.Ara Barsamian, projects that there will be plenty of MGO at a premium over the current HSFO to the extent of $200‐$300/MT, with a higher peak price in mid‐2020.
To assist with questions related to 2020 fuels Viswa has started and in‐house ‘Working Group’. You can reach us at wgfuels2020@theviswagroup.com
Please do not hesitate to contact us if you would like your VLSFO’s tested.
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Source: Viswa
