The Marine Bunker Exchange (MABUX) World Bunker Index has remained at stable levels and did not show any significant changes on week 4.
The 380 HSFO index rose to US$545.80/MT and the VLSFO index grew marginally to US$695.54/MT, while the MGO index increased to US$825.01/MT, showing that after solid growth in the first three weeks of the new year, the pace of the uptrend in bunker prices has slowed down.
The Global Scrubber Spread (SS) weekly average, which is the difference in price between 380 HSFO and VLSFO, showed a moderate growth to US$150.99.
In Rotterdam, the average weekly SS Spread increased even more, to US$160.67. On the contrary, the average weekly SS Spread index in Singapore unexpectedly fell to US$187.83.
In general, SS Spread’s performance did not have single trend across the major hubs, but Index was still well above the psychological US$100 mark, according to MABUX.
“The situation on the European gas market has partially stabilised over the past week, although the threat of a conflict escalation Russia-Ukraine still keeps price indices high,” explained Swedish analysts.
The price of LNG as bunker fuel at the port of Sines in Portugal was US$2,333/MT on 24 January, significantly exceeding the prices of traditional bunker fuels, while MGO LS was US$805/MT as of 25 January.
On week 4, the correlation of MABUX Market Bunker Prices (MBP) Index vs MABUX Digital Bunker Prices (DBP) Index (benchmark) showed that 380 HSFO fuel was overpriced in two ports out of four selected: in Rotterdam with plus US$8 and in Houston with plus US$19.
In Singapore and Fujairah, however, the MABUX MBP/DBP Index registered an underpricing of 380 HSFO by US$10 and US$4, respectively. There were no significant changes in the MBP/DBP Index’s dynamics.
Moreover, VLSFO fuel grade, according to the MABUX MBP/DBP Index, turned out to be overvalued at all selected ports, while Houston moved again into the overcharge zone of plus US$5.
For other ports, the overcharge was registered as: plus US$34 in Rotterdam, plus US$41 in Singapore and plus US$45 in Fujairah. “Except for Rotterdam where the overcharge ratio increased by 16 points, changes of the MBP/DBP Index margins at all other ports turned out to be insignificant,” said MABUX analysts.
As for MGO LS, the MABUX MBP/DBP Index registered an underestimation of this fuel grade in three of the four selected ports: Rotterdam – minus US$13, Singapore – minus US$23 and Fujairah, minus US$4. Houston remains the only port where the MABUX MBP/DBP Index recorded overpricing of plus US$22.
Meanwhile, TotalEnergies is forecasting global marine fuel consumption to increase to around 46 Petajoules (PJ)/d by 2050, with oil-based and LNG bunker fuels still accounting for some 21 PJ/d of demand.
In its projections for what the marine fuel mix might look like in 2030 and 2050, the energy company is forecasting bunker demand to rise from the 32 PJ/d levels in 2019, to 38 PJ/d in 2030 and 46 PJ/d in 2050.
TotalEnergies also reiterates its support for LNG as a key component in shipping’s energy transition. It is forecasting that the LNG bunker market could reach 10 million tonnes by 2025 and suggests it may represent 10% of the bunker market by 2030.
Biofuels and biogas will represent only a small part of bunker demand in 2030 and 2050, according to TotalEnergies, while biofuel will account for 1-2 PJ/d in 2030, climbing slowly to around 2.5 PJ/d in 2050, and the take-up of biogas is estimated to be even less, coming in at under 1 PJ/d in 2030 and rising to around 2 PJ/d in 2050.
Electricity is set to match biofuel demand by 2050, at around 2.5 PJ/d. The demand for hydrogen-based fuels, which covers H2, e-fuels (H2 + CO2), methanol and ammonia is expected to ramp up from around 1 PJ/d in 2030 to 17 PJ/d in 2050, which is still around 4 PJ/d behind the combined total of oil-based and LNG bunker fuels.