Singapore low sulfur marine gasoil demand strengthens despite seasonal lull: traders

Singapore low sulfur marine gasoil demand strengthens despite seasonal lull: traders

Singapore — Demand for low sulfur marine gasoil has been gaining momentum in recent weeks despite the seasonal year-end lull, as shipowners continued to gear up for the switch to cleaner fuels ahead of the International Maritime Organization’s reduction of bunker fuel sulfur limits to 0.5% starting 2020, trade sources said this week.

Currently, the sulfur limit for marine fuels is 3.5%.

Suppliers and traders reported steady buying inquiries for LSMGO over the past few weeks, even though overall bunker demand was slower owing to a buying lull at the end of the year.

“We are gradually seeing more LSMGO inquiries and for bigger quantities, while RMG [380 CST bunker fuel] is slower these days,” a Singapore bunker fuel trader said.

“A lot of owners are preparing for IMO 2020 and some of them are testing their engines using gasoil, especially those who are not installing scrubbers,” the trader added.

LSMGO demand in Singapore has seen a steady uptick as the global mandate for cleaner marine fuels from 2020 looms, with sellers reporting a general 50%-70% increase in inquiries for distillates compared with two years ago.

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