Fuel Switch Snapshot: B30-VLSFO jumps to VLSFO's level on Singapore-EU voyages

Rotterdam B100 drops against conventionals

EU-EU voyages still favour LBM

Singapore B30-VLSFO flips to slight VLSFO premium

EU-EU voyages

Rotterdam’s B100 (POMEME) cost for EU-EU voyages has dropped by $75/mt in the past week. Downward pressures have come from a lower flat price for B100 and a $30/mt increase in its estimated FuelEU pooling value. EU ETS costs have kept steady and are negligible at around $4/mt.

The steep overall price drop for B100 contrasts to $8-15/mt gains for HSFO, VLSFO and LSMGO grades in Rotterdam. B100’s discounts to these conventional fuels have widened by $83/mt to $222-441/mt.

B100’s discounts to LNG have widened by $20-25/mt in the past week. B100 now costs $174/mt less than LNG burnt in a diesel slow speed (diesel SS) engine, and $400/mt less than LNG in an Otto medium speed (Otto MS) engine.

LBM is still the lowest-cost option for EU-EU voyages. 0 gCO2e/MJ LBM bunkered in Rotterdam and consumed in an Otto MS engine is $95/mt cheaper than B100. Consumed in a diesel SS engine, it is $328/mt cheaper.

EU-nonEU voyages

Rotterdam’s B30-VLSFO (POMEME) cost for EU-nonEU voyages has increased by $11/mt on the week, slightly less than conventional VLSFO’s $19/mt gain. That has widened B30-VLSFO’s discount by $8/mt to $31/mt.

In Singapore, B30-VLSFO (UCOME) has surged $37/mt higher, against an $11/mt gain for pure VLSFO. This has flipped B30-VLSFO’s $22/mt discount to VLSFO to a thin $3/mt premium.

Singapore’s B100 (UCOME) cost for EU-nonEU voyages has dropped by $13/mt on the week but is still as high as $1,094/mt as only 50% of the energy of that B100 counts towards FuelEU. HSFO, VLSFO and LSMGO remain at wide discounts of $311-507/mt to B100 on these voyages.

Liquid fuels

Without adjusting for EU regulations, Rotterdam’s VLSFO-equivalent B100 (POMEME) price has dropped by $45/mt to $1,197/mt in the past week. Dutch ZRE A tickets are down by €10/mtCO2e to €155/mtCO2e, adding upward pressure.

Countering downward pressure has come from lower POMEME wholesale prices. Prima Markets has assessed its POMEME CIF ARA barge price down by $36/mt to $1,480/mt.

HSFO and LSMGO prices are up by $16/mt on the week, slightly overshooting a $1.78/bbl ($13.05/mt) front-month ICE Brent rise. Pure VLSFO and B30-VLSFO prices have risen a bit extra, both recording $23/mt gains.

Brent found some support after the European Commission proposed a 20th sanctions package against Russia, a move that could significantly curb Moscow’s energy trade.

Liquid gases

LNG bunker prices have fallen in both Rotterdam and Singapore, pressured down by easing US–Iran tensions.

LNG bunker prices that are VLSFO-equivalent, but not adjusted for EU regulations, have dropped by $41/mt in Rotterdam and $9/mt in Singapore in the past week.

A 9% decline in LNG bunker premiums has weighed on Rotterdam’s price. So has a €3.58/MWh ($65/mt) front-month TTF gas contract decline.

Singapore’s price LNG bunker price has dropped amid a $0.42/MMBtu ($14/mt) fall in the Japan-Korea Marker (JKM) price.

By Erik Hoffmann

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