The competitive pricing of IMO-compliant marine fuel at Zhoushan port is likely to be sustained as state-owned refiners set the stage to ramp up upstream production to cater to the downstream delivered bunker market, industry sources said. The two heavyweights in the China marine fuel market, Sinopec and Chimbusco a PetroChina-COSCO joint venture .
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China pulls bunker demand from other Asian ports as competition grows
Lower bunker fuel prices in China following tax changes last year that have underpinned a ramp-up in production are drawing demand away from the key regional bunkering hub of Singapore and other ports across the region, according to market sources.
“Prices are so low [in China] there is no reason not to go to China now,” a Singapore-based bunker trader said.
“A key factor that has depressed overall demand in Singapore is the marine fuel 0.5%S spread between the port of Singapore and Zhoushan. Shipowners have been maximizing stems while queuing at anchorage for cargo operations around Zhoushan, said a Singapore-based trader.
Not registered? Receive daily email alerts, subscriber notes & personalize your experience. Register Now Prices are so low [in China] there is no reason not to go to China now, a Singapore-based bunker trader said. A key factor that has depressed overall demand in Singapore is the marine fuel 0.5%S spread between the port of Singapore and Zhoushan. Shipowners have been maximizing stems while queuing at anchorage for cargo operations around Zhoushan, said a Singapore-based trader.
Singapore typically has the most competitive prices in the region but Zhoushan marine fuel 0.5%S delivered bunker prices dropped below those in Singapore on April 12 and have remained at a discount since then. Zhoushan delivered bunker was assessed at $495/mt, $8.75/mt lower than Singapore on April 29.