Fuel Switch Snapshot: B100 and LBM still make sense with FuelEU pooling

Rotterdam’s B100 at wider discounts to conventional fuels

LBM rises against LNG in Rotterdam

EUA costs fall for fossil fuels

All bunker prices mentioned below have been adjusted for calorific contents to make them VLSFO-equivalent. They have estimated EU-EU voyage compliance costs included for Rotterdam, and non-EU-EU compliance costs included for Singapore. These account for EU ETS costs and FuelEU Maritime penalties, and our estimated compliance surplus values for FuelEU pooling. Rotterdam's B100 and LBM prices also factor in Dutch HBE rebates for advanced liquid and gaseous biofuels sold in the Netherlands.

Rotterdam’s HBE-rebated B100 benchmark has dropped to $24-33/mt greater discounts to HSFO, VLSFO and LSMGO for voyages between EU ports. It is now priced $139/mt, $160/mt and $328/mt lower than these grades, respectively.

Singapore’s B100 UCOME benchmark is at hefty premiums over conventional fuels for voyages between Singapore (a non-EU port) and EU ports. Its premiums over HSFO and VLSFO have narrowed by $14-18/mt on the week to $544/mt and $481/mt, respectively. Its premium over LSMGO has plunged $53/mt lower to $286/mt.

Rotterdam’s LNG has dropped by $15/mt in the past week. That has moved it to smaller premiums of $46/mt over HSFO and $25/mt over VLSFO for dual-fuel vessels with Otto medium speed (Otto MS) engines. But compared to LSMGO, LNG is now $143/mt cheaper.

Singapore’s LNG has narrowed its premium over VLSFO to $50/mt, and to $113/mt over HSFO. Its discount to LSMGO is $145/mt.

For vessels with diesel slow speed (diesel SS) engines, Rotterdam’s LNG is at wide discounts of $93/mt to HSFO, $114/mt to VLSFO and $282/mt to LSMGO. This is because these engines have much lower methane slip than Otto MS ones and are therefore less penalised by the EU.

In Singapore, LNG diesel SS is priced $43/mt over HSFO, while at discounts of $20/mt to VLSFO and $215/mt to LSMGO.

Rotterdam’s liquefied biomethane (LBM) is $147/mt cheaper than LNG for a vessel with an Otto MS engine, and $151/mt cheaper than LNG for a diesel SS engine vessel.

Liquid fuels

Rotterdam’s HSFO and VLSFO prices are down by $4-6/mt on the week for EU-EU voyages. A $29/mt drop in EU Emission Allowance (EUA) costs for these fuels, and a $1/mt drop in FuelEU Maritime penalties have countered rises in their outright prices.

B100 has gained $27/mt in Rotterdam, as its assessed pooling value has increased by $15/mt to $661/mt, and as the outright B100 price has jumped $42/mt higher on the week.

In Singapore, HSFO and VLSFO prices have edged $4-6/mt higher, while its LSMGO price has pushed $43/mt higher. Singapore’s B100 price has gained $8/mt.

Liquid gases

LNG has shed $15/mt to $565-704/mt in Rotterdam for EU-EU voyages, and by $10-11/mt to $565-634/mt in Singapore for non-EU to EU voyages. The price spreads depend on engine types and methane slips.

The LNG prices have dropped amid $26/mt declines in EUA costs for LNG consumed between EU ports, and a $13/mt drop between non-EU and EU ports.

Rotterdam and Singapore’s outright LNG prices have gained slightly on the week amid slight upticks in TTF and JKM gas prices, and a larger assessed bunker delivery premium in Rotterdam.

LBM is up by $10-11/mt on the week to $415-557/mt in Rotterdam, depending on engine type.

By Erik Hoffmann

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