IBIA, S&P Partner to Encourage IMO2020
The International Bunker Industry Association (IBIA) and price-reporting agency S&P Global Platts are to work together to help market participants across the shipping ecosystem prepare ahead of the implementation of the International Maritime Organization (IMO) low sulfur marine fuel regulations in January 2020.
Unni Einemo, Director of IBIA and its representative at the IMO said: "We are very pleased to work with S&P Global Platts in bringing industry stakeholders the tools they need to manage the transition to IMO 2020."
Unni added: "IBIA has been heavily engaged in working at the IMO to help develop guidelines for effective implementation, including preparations such as tank cleaning contained in the IMO's Ship Implementation Plan, and recently in a Joint Industry Project to develop guidance on the safe supply and use of compliant fuels. Through this new collaboration, we will also have access to market data and analysis from a trusted partner."
Vera Blei, Global Director, Head of Oil Markets, S&P Global Platts said: "We are delighted to strengthen our close partnership with IBIA which aligns with our ongoing commitment to support the global shipping community as it transitions towards IMO 2020. The transparency offered by our full suite of Marine Fuel 0.5% and HSFO price assessments together with the in-depth market insight provided by our global News and Analytics teams plays an important role in helping the industry understand and comply with what many consider to be the most disruptive change in living memory."
The premium of 0.5% marine fuel to high sulfur fuel oil in Europe has grown this year as preparations continue in earnest for the implementation of the new sulfur cap.
The FOB Rotterdam Marine Fuel 0.5% barges were assessed at a $69.75/mt premium January 2, the first day of Platts 0.5% Marine Fuel assessments but increased during August to a premium closer to $210/mt.
Contributing to the increase in the 0.5% vs.3.5% spread was increased demand causing a firming of the Platts 0.5% Marine Fuel assessments ahead of the January 2020 implementation, while softening of the 3.5% high sulfur fuel oil driven by falling demand for bunker fuel, with market participants less inclined to utilize storage options.
In Asia, Singapore premiums for Marine Fuel 0.5% to the Mean of Platts Singapore 380 CST high sulfur fuel oil reached as high as $135.00/mt in June, with the premium on September 1 around $120/mt.
According to traders the relatively large amount of 0.5% being stored in large tankers near Singapore, in addition to in land-based storage tanks, and the relatively low demand levels were the reason for the decline in the premium of 0.5% over 3.5% from June to September.