Robin Meech Marine and Energy Consulting Ltd. and
FACTS Global Energy (FGE) have released a study which looks into the future of the bunker and fuel oil market.
Entitled
'Outlook for Marine Bunkers and Fuel Oil to 2030', the biennial study provides an up to date assessment of the latest legislative changes in the marine bunker sector until 2030, and quantifies the impact on demand, and product differentials, as well as suggesting ways in which the refining, shipping and storage sectors could react to the changes.
Key issues include:
* How feasible is the IMO's proposed 'Global Sulphur Cap' of 0.50% in 2020?
* The rate of progress in emission abatement technologies (scrubbers).
* The role of alternatives, i.e. LNG, as well as increased engine energy efficiency and routing software.
* Likely growth in overall bunker demand and split between residual fuel oil and distillates, as well as high and low sulphur fuel oil.
* Will Emission Control Areas (ECA's) distort the fuel oil market in the short-term?
* Impact of the US ECA.
* Reactions by refining industry to these uncertainties.
* Can refiners meet potential increase in distillate fuels if bunker demand shifts from fuel oil? At what cost?
* If IMO proposal is deferred, will more ECA's be introduced?
* Distillate/fuel oil spread by 2020/2024.
Conclusions:
The main conclusions indicate that under pressure from the impending marine emissions legislation, the mix of fuels used in the shipping industry will indeed proliferate, that on-board scrubbing will become viable, initially for vessels operating in ECA areas, but subsequently for all new builds.
The study also concludes that implementing the IMO proposals by 2020 will be virtually impossible, requiring the refining industry to invest in more than 4 million b/d of extra secondary processing capacity, above that already scheduled.
A table of contents has been provided below.
1. Introduction
2. Key Conclusions and Findings
2.1. Timing of 0.50% Global Sulphur Cap
2.2. Implications of MARPOL Annex VI
2.2.1. National Governments
2.2.2. Oil Refiners
2.2.3. Ship Owners
2.2.4. Emission Abatement Technology Companies
2.2.5. Port Authorities/national environmental authorities
2.2.6. Bunker Fuel Suppliers
2.2.7. Oil Storage Operators
3. Executive Summary
4. Environmental Regulation
4.1. Current Situation
4.2. 2012-2014
4.3. 2015 to 2020
4.4. 2020/2025
4.5. Compliance
4.6. Future ECA
5. Bunker Demand
5.1. Global Trade
5.2. The Global Fleet
5.3. Fuel Efficiency
5.4. Slow Steaming
5.5. Alternative Fuels (Excluding LNG)
5.6. LNG
5.7. Abatement
5.8. Bunker Consumption
5.8.1. Base Case
5.8.2. Sensitivity Cases (Low and High)
5.8.3. Early Global Cap Case (2020)
5.8.4. Post 2030 Outlook
6. Crude Oil Availability
6.1. OPEC
6.2. Non-OPEC
7. Refining Developments and Bunker Fuel Supply
7.1. Refining Capacity Outlook
7.1.1. Investment 2011-2020
7.1.2. Outlook for Closures
7.1.3. Beyond 2020
7.2. Fuel Oil Market from Refiners’ Perspective
7.2.1. Refinery Supply of Bunker Fuel
7.3. Distillate (Gas Oil/Diesel) Market from Refiners’ Perspective
7.4. New Refining Technologies for Residue Conversion
7.5. Refiners’ response to changing oil demand patterns
7.6. What happens if the IMO global cap is enforced in 2020?
Outlook for Marine Bunkers and Fuel Oil to 2030 July 2011
8. Oil product prices and differentials
8.1. Crude oil prices
8.2. Oil product price differentials and refinery margins
8.3. Projected price differentials between middle distillates and fuel oil
9. Appendix
9.1. Residual Bunker Fuel Demand by subregion: Base Case (IMO Global Cap
in 2025)
9.2. Distillate Bunker Fuel Demand by subregion: Base Case
9.3. Residual Bunker Fuel Demand by subregion: 2020 Global Cap Case
9.4. Distillate Bunker Fuel Demand by subregion: 2020 Case
9.5. Residual Fuel Oil Supply and Demand by Region
9.6. Distillate (Gas Oil) Supply and Demand by Region
9.7. Price Forecasts
9.7.1. NW Europe Products
9.7.2. Mediterranean Products
9.7.3. US Products
9.7.4. Singapore Products
9.8. Regional Definitions
9.9. Glossary
