All Eyes on 2020
The International Maritime Organization’s proposals to reduce sulfur levels in marine fuels to a maximum of 0.5 percent m/m (mass/mass) by 2020 may prove to be controversial, having met with various responses from major shipping organisations and other bodies. The decision to implement the proposals by 2020 was taken by IMO, the regulatory authority for international shipping, during its Marine Environment Protection Committee (MEPC 70) meeting, which was held in London, UK in October 2016, and represents a significant reduction from the 3.5 percent m/m global limit currently in place.
New Rules on Ship Emissions Herald Sea Change for Oil Market
New rules coming into force from 2020 to curb pollution produced by the world's ships are worrying everyone from OPEC oil producers to bunker fuel sellers and shipping companies.The regulations will slash emissions of sulfur, which is blamed for causing respiratory diseases and is a component of acid rain that damages vegetation and wildlife.But the energy and shipping industries are ill-prepared, say analysts, with refiners likely to struggle to meet higher demand for cleaner…
New Online Tool Aids 2020 Sulfur Compliance
The new ‘Sulfur 2020 – Options Evaluator’ from Lloyd’s Register (LR) aims to help the industry identify the best strategy for compliance with the global sulfur in fuel oil limit of 0.50 percent m/m, which comes into effect on January 1, 2020.According to LR, the ‘Options Evaluator’ aims to bring clarity to what the potential cost and investment implications could be for the various compliance strategies, such as transition from fuel oil to marine gasoil (MGO), use of scrubbers…
Marshall Islands to Address Shipping Safety Concerns
The Republic of the Marshall Islands (RMI) has submitted a paper to the International Maritime Organization (IMO) Intersessional Working Group (ISWG) on the consistent implementation of the 2020 global fuel oil sulphur standard under MARPOL Annex VI. The submission, which was co-sponsored by the Republic of Liberia, the Baltic and International Maritime Council (BIMCO), the International Chamber of Shipping (ICS), the International Association of Dry Cargo Shipowners (INTERCARGO)…
Hurtigruten Signs on to Ban HFO in the Arctic
Expedition cruise ship operator Hurtigruten has joined international environmental organizations in efforts aiming to spearhead the protection of Arctic communities and ecosystems from risks posed by the use of marine heavy fuel oil (HFO) to power ships. At the Arctic Frontiers conference in Tromsø, Norway, Hurtigruten CEO Daniel Skjeldam signed the Arctic Commitment along with Dr. Sian Prior of the Clean Arctic Alliance, lead advisor to the Clean Arctic Alliance, an international coalition of environmental organizations campaigning for a ban on heavy fuel oil use in the Arctic.
USCG Marine Safety Alert
The U.S. Coast Guard issued a marine safety alert today to remind vessel owners and operators to establish effective fuel oil changeover procedures during efforts to comply with MARPOL Annex VI emission regulations. The USCG said that several recent incidents of fuel leakages during changeovers prompted the alert. The USCG cited multiple unspecified incidents involving substantial machinery space fuel leakages that occurred while vessels were switching fuel oil to ultra low sulfur (ULS) fuel oil to ensure compliance with MARPOL Annex VI, Regulation 14.3.4. The new regulations, which came into effect on January 1, lowered maximum fuel sulfur content from 1.0% to .10%.
Singapore Fuel Oil Trading Heats Up
Singapore fuel oil trading volumes have soared after the 380-cst front-month time spreads widened by around $1 per tonne from the previous day's close, in what could develop into an aggressive trade strategy that occasionally rattles this market. The 380-cst March/April time spreads on the Intercontinental Exchange (ICE) saw about 700,000 tonnes in contracts trade after physical trading in the S&P Global Platts Market-on-Close (MOC) price assessments concluded at 0830 GMT on Tuesday. The flurry took the spreads to about $1.70 a tonne in post-European trade by 0400 GMT on Wednesday, from around plus 70 cents a tonne previously. Traders…
Aframaxes Taken for Short-term Time Charters in Asia
The Asian Aframax market is currently stable but seems to be facing a more positive outlook on the back of short-term time charters as well as an increase in third decade cargoes. Rates for an Indonesia/Japan run basis 80 kt are hovering around w100 to w102.5, while rates for the AG/East route basis 80 kt stand at w115. Reflecting firmer owner sentiment, TD14 inched up steadily w-o-w to w100.78 which translates into daily earnings of around $8,700/day. At least three Aframaxes…
ClassNK Launches Bunker Fuel Oil Analysis Service
ClassNK’s subsidiary ClassNK Consulting Service (NKCS) has officially launched its Bunker Fuel Oil Analysis Service. The service will provide an oil analysis report for the properties of bunker fuel oil based on the ISO8217 Standard with advice such as oil heating and purification. Testing laboratories are located worldwide in Singapore, UAE, U.K. and U.S. After sampled oil is received at the nearest laboratory from each ship, an analysis report will be provided by email and online within 48 hours. In addition to analysis based on the ISO8217 Standard, the Bunker Fuel Oil Analysis Service also provides special analysis services based on request…
Mercuria, PetroChina Selling Offshore Stored Fuel Oil
Three to four tankers storing fuel oil, down from eight or nine. Independent trading house Mercuria and Chinese state oil giant PetroChina are selling fuel oil stored in vessels off Singapore and southern Malaysia on strong demand from the shipping and power sector, several trade sources said on Friday. The number of vessels storing fuel oil has halved from a month ago as Mercuria and PetroChina may have resold cargoes purchased over March to May, the sources said. Geneva-based…
Ban Heavy Fuel Oil in the Arctic: WWF-Canada
International Maritime Organization (IMO) has agreed to take steps that could lead to a phase-out of the use of heavy fuel oil (HFO) in Arctic shipping following an appeal from the Government of Canada, Indigenous participants and testimony from WWF-Canada. During a week-long meeting at IMO headquarters in London, WWF highlighted recent reports outlining major gaps in spill response capacity in the Arctic. The Canadian delegation’s submission on how to reduce the impacts of HFO in the Arctic received wide support from all Arctic states (United States…
Ocean Conservancy Calls for Clean Arctic
“Ocean Conservancy welcomes steps taken by the International Maritime Organization to mitigate risks to the Arctic from the use and carriage of the world’s dirtiest fossil fuel. “Support for Measures to Reduce Risks of Use and Carriage of Heavy Fuel Oil as Fuel by Ships in Arctic Waters marks an important milestone in the bid to phase out the use of heavy fuel oil in the Arctic. “With climate change impacts resulting in record-breaking loss of sea ice—winter ice in the Arctic…
Genoil Signs Tri-Partite Scientific Pact on Low Sulphur Fuel Oil
Clean technology engineering company for the petroleum industry Genoil Inc has signed a tri-partite science, research and technical cooperation agreement with two leading Russian institutions. Genoil has joined forces with the UFA Scientific Research Institute of Petroleum Refining and Petrochemistry, located in Bashkortostan, Russia, and the OJS VNIIUS Institute, located in Tatarstan, Russia to establish a world class partnership. The scope of the agreement is to research, develop and market cutting-edge technologies and patents both in the Americas and globally.
Global Trade Surge Fuel Oil Markets
Global trade is growing at the fastest rate for six years - which is both a symptom and a cause of the recovery in commodity markets. World trade volumes were up almost 5 percent year-on-year from May to July, according to estimates compiled by government economic planners in the Netherlands. Growth was four times faster than at the same point in 2016 (http://tmsnrt.rs/2y89NxC). Global trade and commodity markets are linked in a circular causal relationship, which is one of the most important in the macroeconomy and a key source of fluctuations in the business cycle. Commodities, from grains to minerals, metals and oil, are the largest item in global trade by tonnage, so the state of commodity markets has a major impact on world trade flows.
S.Korean Refiners Look to Cash in on 2020 Mandate
Three refiners to spend more than $5 bln to upgrade or add units. South Korean refiners are planning to spend over $5 billion on plant upgrades in response to tighter rules on shipping fuel, boosting production of low-sulphur fuel oil as well as other high-end products. The refiners hope the investment, which comes ahead of the 2020 introduction of the new rules, will make them one of the biggest beneficiaries of the new regulations, with many competitors still waiting to commit to new spending. "Not many refiners are doing so.
Cleaner Maritime Air for North America Comes Soon
On the operative day the sulfur content of the fuel oil used on board ships operating within the ECA may not exceed 1.00 percent m/m (10,000 ppm). The boundaries of the North American ECA are defined in IMO MEPC.1/Circ.723 . The US EPA has issued Interim Guidance on the Non-Availability of Compliant Fuel Oil for the North American ECA and more information is also available on the US EPA website.
BV Classes First LNG-fuel Oil/Chemical Tanker
Leading international classification society Bureau Veritas has classed the first LNG-fuelled newbuilding oil/chemical tanker, the 15,000 dwt Ternsund, built under BV class at Avic Dingheng, China and delivered to Denmark’s Terntank Rederi at the end of June 2016. The new vessel is the result of close co-operation between Terntank, Avic and Bureau Veritas. The Ternsund is the first of a series of four ships all equipped with the Wärtsilä RT-flex50-D dual-fuel low-speed engine. This is the first installation of such engine and it was done under BV class.
IMO/MARPOL Amendments Enter Into Force
Requirements for ships to collect data on their fuel oil consumption entered into force on 1 March. Other important amendments to the International Convention for the Prevention of Pollution from Ships (MARPOL) have also entered into force, covering the classification of garbage, including the addition of a new category of “e-waste”, and amendments to the International Oil Pollution Prevention Certificate. The ship fuel oil consumption data reporting requirements are the latest mandatory requirements aimed at enhancing the energy efficiency of international shipping.
IMO Sets 2020 Date for Ships to Comply with Emission Requirements
In a landmark decision for both the environment and human health, 1 January 2020 has been set as the implementation date for a significant reduction in the sulphur content of the fuel oil used by ships. The decision to implement a global sulphur cap of 0.50% m/m (mass/mass) in 2020 was taken by the International Maritime Organization (IMO), the regulatory authority for international shipping, during its Marine Environment Protection Committee (MEPC), meeting for its 70th session in London.
LNG Fuel is Not a Cure-all Solution
Liquefied natural gas (LNG) is not a panacea to reducing greenhouse gas emissions, and its increasing use as a marine fuel could be worse for the environment than burning heavy fuel oil, said Ian Adams, the former CEO of the International Bunker Industry Association. “Whilst it is well documented that LNG is an excellent solution for reducing SOx and NOx emissions, I am dismayed to see it being promoted as a solution for reducing GHGs,” Adams said, in stark contrast to claims that the use of LNG as a marine fuel can reduce the industry’s CO2 emissions by as much as 75 percent. Adams, a Fellow of the Institute of Marine Engineering, Science & Technology who now heads the Association of Bulk Terminal Operators…
Clean Arctic Alliance Response to Arctic HFO Ban
“The Clean Arctic Alliance welcomes AECO’s reconfirmation of its support for an international ban on heavy fuel oil in Arctic waters. AECO’s decision demonstrates the growing conviction within the shipping industry that the Arctic is simply too vulnerable and too fragile to allow the use of this dirtiest of fuels, and that HFO can no longer be considered an option for powering Arctic shipping in the future”. “By acknowledging the threats posed by spills and black carbon emissions from heavy fuel oil…
Clean Arctic Hails IMO Action on HFO
The Clean Arctic Alliance has applauded progress by International Maritime Organization member states towards banning use of the world’s dirtiest fuel – heavy fuel oil – from Arctic shipping. It also called for Member States to make every effort to adopt and rapidly implement a ban by 2021, as proposed by eight IMO Member States and supported by other countries during the meeting. Plans to develop a ban on heavy fuel oil (HFO) from Arctic shipping, along with an assessment of the impact of such a ban…
Singapore's Bunker Market Rallies
The Singapore fuel oil market has rallied this week as inventories have dropped at the same time that some supplies in the region do not meet the standards for use as shipping fuel, further reducing the amount of supply available, five trade sources said.Cash premiums for 380-centistoke fuel oil, which is primarily sold for ship fuel, known as bunker fuel, have soared this week to the highest since May 2017. The premium of the prompt-month swap for the fuel over the second-month swap has jumped to the highest since October…