North American ECA welcomed by European bunker players

09 Mar 2011

BunkerWorld - North American ECA welcomed by European bunker players.

Bunker suppliers in Europe expect to see a jump in sales of low sulphur fuel oil in 2012 when the North American emission control area (ECA) is due to take effect.

"We look forward to this as ships will need to have LSFO on board prior to arrival in the US, and we see a large amount of ships operating between Europe and North America,"  Patrik Pettersson, Executive Vice President, Marketing & Sales at Stena Oil told Bunkerworld in an interview.

"In Scandinavia we have good supplies of LSFO, while the US will have to import more,"  said Pettersson.  He believes that will give suppliers in Scandinavia an edge, and LSFO sales should grow.

Stena Oil is a physical bunker supplier in the ports and coastal waters of Sweden, Denmark, Norway and the Baltic part of Germany, and also has experience as a bunker buyer for Stena tankers, ferries and other company group vessels.    As such, Stena Oil has witnessed first hand the effect of first ever Baltic ECA and the expansion of the ECA to the North Sea and English Channel.

The comany's LSFO sales have grown compared to regular high sulphur fuel oil (HSFO), and it now sells about 60% LSFO and 40% HSFO in Northern Europe, while the split was closer to 40% LSFO and 60% HSFO in 2006 when the Baltic became subject to bunker fuel sulphur limits.

Stena Oil's customers include both Baltic Sea liner operators, which are required to observe the ECA sulphur limits at all times, and ships in transit that need both LSFO for the ECA leg of their journey and HSFO upon leaving the low sulphur zone.  

Meanwhile, a bunker supplier and trader in Gibraltar told Bunkerworld today that the port's share of LSFO sales at present is around 10-15% compared to HSFO sales.  

He predicted that the LSFO share could jump to 20-30% because of demand for the North American ECA, which is due to take effect from August 2012.

Gibraltar is used as a 'bunker-only' call for vessels transiting the Straits of Gibraltar, and is in a good position to supply ships that need LSFO when they are heading for the ECA zones in northern Europe.  It could similarly benefit from its position for US-bound ships.

The full interview with Stena Oil's Pettersson will be printed in the March/April issue of the Bunker Bulletin.  It looks at the company's experience with ECAs so far, and Pettersson's his views on how the market will look in 2015, when the ECA sulphur limit falls from the current 1.00% to just 0.10%. - Unni Einemo, London News Desk, 8th March 2011