- Singapore, the world’s largest maritime refueling port reported that they have enough low-sulfur fuel next year to meet new demand.
- Singapore has been working with big oil refiners and shipowners to meet new demand tied to emissions measures.
- Shanghai, Malaysia’s Tanjung Pelepas, Rotterdam and Hamburg are also working to secure supplies of the new lower-emission fuel.
- New fuels are expected to cost 40% more than traditional bunker fuel, boosting operators’ annual fuel bill by as much as $15 billion.
According to an article published in Wall Street Journal, the world’s biggest refueling station says it will have enough low-sulfur fuel next year to meet new demand tied to emissions measures.
Ample supply of fuel
Singapore, the world’s largest maritime refueling port, said it will have an ample supply of cleaner fuel to meet an increase in demand next year, when the global commercial fleet will be required to cut sulfur emissions.
Janil Puthucheary, the island state’s senior minister for transport, told a shipping conference Tuesday that Singapore has been working with big oil refiners and shipowners and will have no problem procuring sufficient volumes of fuel that is compliant with new industry rules.
Major fuel supplier
The Singapore port is a major fuel supplier for vessels servicing the world’s busiest ocean trade route from the Far East to Northern Europe. Other global gateways like Shanghai, Malaysia’s Tanjung Pelepas, Rotterdam and Hamburg are also working to secure supplies of the new lower-emission fuel.
The change from heavy oil with a sulfur content of 3.5% to cleaner mixes with 0.5% sulfur goes into effect on Jan. 1 and will affect more than 60,000 vessels.
Testing new fuel
Oil majors like BP PLC and Royal Dutch Shell PLC have been testing the new fuels in Singapore amid concerns that they can create engine problems, especially on older ships.
The shift mandated by the International Maritime Organization, the global shipping regulator, has roiled the maritime industry. The new fuels are expected to cost 40% more than traditional bunker fuel, boosting operators’ annual fuel bill by as much as $15 billion.
Shouldering charges
Many cargo owners are resigned to shouldering much of the bill through shipping surcharges. In the case of retailers, who are big users of container ships, they will have to decide whether to pass the costs along to consumers in the form of higher prices.
Curbing sulfur emissions is the first step in shipping’s quest to become more friendly to the environment. The industry has agreed to cut greenhouse emissions in half by 2050, a far costlier exercise that will involve new hull designs and hybrid propulsion systems.
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Source: wsj
