IBIA members concerned residual fuel produced in the Middle East currently exceeds the 3.5% limit
Major bunker supplier and trader OW Bunker has assured its customers of sufficient availability of IMO compliant fuel after 1 January 2011 despite concerns over supply, particularly in the Middle East.
DNV Petroleum Services has recently warned that suppliers will face a challenge in meeting the demand for fuel oil with a sulphur content of 3.5%. This follows the Marpol Annex VI regulation that will see the global sulphur content of fuel oil reduced from 4.5%. The global sulphur limit applies to all waters other than Emission Control Areas (ECAs), where fuel oil with a sulphur content of 1% must be used.
Also, at the recent International Bunker Industry Association (IBIA) annual convention in Barcelona, several IBIA members pointed out that much residual fuel produced in the Middle East currently exceeds the 3.5 per cent limit. They were worried that, since none of the countries in the region are signatories to Marpol Annex VI, there might be nothing in place to force suppliers there to provide IMO compliant fuel. The general expectation at Barcelona was that bunker fuel taken on in the Middle East would continue to exceed the 3.5 per cent limit, at least until there is strong market pressure for compliant fuel.
If so that would put VLCC owners, for example, in a difficult position. VLCCs working in the spot market will typically bunker once a cargo has been fixed and take on sufficient for the voyage. IMO regulations mean that, from January, in theory just enough non-compliant bunkers should be taken on to allow the vessel to reach a port where compliant fuel is available.
Several speakers from the floor said that this simply would not happen, initially at least, as charter party terms will not allow deviations for taking on fuel. So VLCCs are likely arrive at their destinations with fuel that breaks the legal sulphur content. That in turn is likely to attract the attention of port state control inspectors.
However OW Bunker’s Regional Manager, Middle East and South Africa, Jesper Jervild, said in a press statement last week: “Despite recent claims, OW Bunker has already assured its customers that there will be ample supply for fuel oil with a sulphur content of 3.5% and below, not just in the Middle East, but on a global basis.”
He added: “From all key ports in Europe and the US to Asia, South America and the Middle East, including Fujairah, customers will have access to quality compliant products wherever and whenever they need them. In fact we’re already providing them right now in Suez.”
Mr Jervild concluded: “While supply is not an issue, with less than two months until the New Year, we would advise ship owners and operators to prepare for the transition and ensure that they have in place the most efficient and best-priced fuel procurement strategy that meets the needs and demands of their specific operations and transit routes.”
Source: World Bunkering
