N. American ECA May Tighten Supply of Distillate Fuel
The move to burn 1% RMG 380 spec & other bunker fuel may tighten inventories following the ECA imlementation 1, Ausgust 2012
The stock of available bunker fuels may be tightened as suppliers juggle limited space with increasing selection for shipowners and buyers, according to Platts' market sources
The primary concern associated with the implementation of the new ECA specs has been the cost involved with moving to low sulfur fuel oil as less and less LSFO is being produced. However, market sources say, the spec change has also had suppliers carrying more types of bunker fuel, including cheaper-to-make RMK 500 selections, which has begun to put pressure on existing infrastructure.
"No new tanks are being built for bunkers, so any tankage will be cannibalized from other products," explained a fuel oil trader who trades in both the Gulf Coast and Atlantic Coast.
The end result will be that working inventory of 3.5%S RMG 380 will fall as tank space is taken to make room for needed volumes of 1%S RMG 380, another fuel oil trader who trades on both coasts said.