Singapore marine fuel sales rise in June after 2-month decline, likely due to lower prices
Sales of bunker or marine fuel were about 4.7 million tonnes last month, MPA data shows
[SINGAPORE] Singapore, the world’s largest bunkering hub, stemmed a two-month decline in marine fuel sales in June, edging up a modest 1.6 per cent year on year. The rise was notable and likely driven by lower bunker prices, an analyst said.
Sales of bunker or marine fuel were about 4.7 million tonnes last month, data from the Maritime and Port Authority of Singapore (MPA) published on Tuesday (Jul 14) showed, up 2.7 per cent over the month.
Mahua Mitra, head of marine fuels pricing for the Asia-Pacific at energy and commodity market intelligence provider Argus, told The Business Times that the better showing was likely supported by a sharp decline in bunker prices following the easing in crude oil markets.
In May, sales were affected by higher prices in Singapore as vessels diverted to China for cheaper marine fuel amid tight supply to Asia, due to the effective closure of the Strait of Hormuz – through which 20 per cent of the world’s oil typically flows – by Iran after it was attacked by the US and Israel.
Mitra noted that prices of very low sulphur fuel oil (the primary marine bunker fuel used by the global shipping industry) in Singapore, assessed by Argus, fell to US$592 a tonne on Jun 30. This was down 20.4 per cent from US$743.75 a tonne in the month before. (*see amendment note)
She said: “Lower bunker prices appear to have encouraged more shipowners to return to the market after several months of cautious purchasing, particularly as many operators had reduced stem sizes or deferred bunker purchases earlier in the year amid elevated prices and market volatility.
“The recovery in bunker sales is notable given that supply conditions in Singapore remained tight throughout much of June.”
Stem size refers to the total volume of fuel, measured in metric tonnes, supplied in a single order.
Spot prices for bunkers delivered in Singapore spiked for key grades shortly after the US and Israel started bombing Iran on Feb 28. Prices have since dropped, although they remain much higher than before the conflict.
The higher bunker sales in June were logged despite 72 fewer vessels – or a total of 3,618 – arriving for refuelling in Singapore compared with May.
Oil tankers that came in June also dropped in numbers and volume. Only 1,591 tankers with a total gross tonnage of 59.7 million called at the city-state, compared with 1,658 with a total gross tonnage of 61.8 million for the month-ago period. Gross tonnage measures the total internal volume of tankers.
The Singapore Registry of Ships (SRS), meanwhile, had 4,489 vessels flying its flag as at end-June, up 34 from May, with a combined gross tonnage of 143.1 million. These are the highest levels since 2018’s 4,456 vessels with a total gross tonnage of 90.9 million.
SRS saw a spike of 406, or 10.2 per cent, in the number of vessels it administered last year after more shipowners reflagged their fleets to the Republic in an attempt to navigate geopolitical tensions between the US and China.
*Amendment note: An earlier version of this story incorrectly said that Singapore-delivered very low sulphur fuel oil was US$592 a tonne. Mahua Mitra has since corrected to say the earlier figure was not delivered price. The article above has been revised to reflect this.
