Help Desk -
9717405332, 9599714297, 9810335381

Shipowners scramble to install sulphur filters ahead of rule change - JBC Energy

Logistic News - Published on Thu, 18 Oct 2018

Image Source:
Reuters reported that ship owners accelerated installations of engine cleaning systems this year ahead of stringent new rules in 2020 which sharply reduce the amount of sulphur ships can emit from the 3.5 percent in current bunker fuel to 0.5 percent. Vessel operators can either switch to cleaner, but more expensive, marine gasoil or install scrubbers to filter sulphur from dirtier fuel oil. The looming change in International Maritime Organization (IMO) rules has impacted fuel and gasoil futures. The future prices of high sulphur fuel oil (HSFO) dropped sharply over the past year ahead of the anticipated drop in demand from 2020 while gasoil prices are expected to rise.

According to market-leader Wartsila, lower HSFO prices however have made scrubbers more economically attractive to shippers. Scrubber equipment alone can cost between EUR 1 million and EUR 5 million. If demand for HSFO drops less than expected prices could rebound.

Vienna-based consultancy JBC Energy said in a note “The more positive outlook for scrubbers could reinforce the trend seen over recent months of a narrowing discount of fuel oil relative to gasoil. Expectations that HSFO demand could remain more robust than perhaps previously expected now helping to prop up HSFO prices along the forward curve.”

JBC said that with the spread between HSFO and 0.5 percent gasoil currently at around USD 28 a barrel, scrubber installation still makes economic sense. A total of 1,850 vessels have now installed the smokestacks cleaning systems, known as scrubbers, Norwegian consultancy DNV GL said in a report, dated on October 10.

Source :

Posted By : Nanda Koijam on Thu, 18 Oct 2018
Related News from Logistic segment