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Singapore bunker sales curbed by fuel oil contamination

Singapore bunker sales curbed by fuel oil contamination

Sales of marine fuels in Singapore during August totalled 3.96mn t, down from 4.04mn t last month and a fall of 401,000t against a year earlier, as contamination concerns urged shipowners to bunker elsewhere, provisional data from Singapore’s Maritime and Port Authority (MPA) showed.

Too high levels of phenol, styrene and fatty acids in fuel oil blends in Singapore have caused a multitude of engine problems, with quality concerns substantially raising the premium of delivered bunkers in the port. Some customers as a result have opted instead to bunker in China, South Korea, Russia’s far east and Japan, according to traders.

“Our Singapore volumes have been lower by 12-15pc in August compared to July”, according to one bunker buyer from a large shipowner. “But our response was mostly price motivated rather than based on quality concerns”.

Sales volumes were also lost to the UAE port of Fujairah. “Tanker owners have certainly avoided Singapore for bunkering in August and also in early September, and have instead bunkered in Fujairah if possible”, according to one broker.

A bunker manager of a large shipowner confirmed that Fujairah was preferred over Singapore whenever ships were sailing from Asia-Pacific to the Mideast Gulf. Fujairah has so far not been affected by the contamination crisis.

Consumption of 380cst marine fuel oil (MFO) in Singapore, which accounts for about 70pc of total sales, fell to 2.82mn t from 3.23mn t last year and 2.92mn t in July. Sales of the higher viscosity MFO 500cst grade, the fuel of choice for large container lines and tankers, fell by 15,600t year on year to 877,000t but rose slightly by 36,000t from July. Low-sulphur marine gasoil sales rose to 125,700t, an increase of 25pc from last month and up by 16,100t the previous year. Consumption of the low-sulphur fuel oil 180cst grade fell back to 20,300t after reaching a record level of 27,200t in July.

Total sales of marine fuels during January-August were 33.35mn t, down by nearly 1pc from a year earlier.

Singapore’s delivered 380cst MFO prices averaged $457/t in August, up from an average of $307/t a year earlier but down slightly from $463/t in July, data collected by Argus showed.

An estimated 3,128 vessels called at Singapore to refuel in August, a six-month low and fewer than 3,334 a year earlier and down from 3,297 in July, according to the MPA.