Ships stuck waiting for fuel in Singapore due to new rule

Ships stuck waiting for fuel in Singapore due to new rule

It’s taking about 2 weeks to book a barge instead of the usual 5 days.

File picture shows ships approaching the Singapore port. (Pixabay pic)
SINGAPORE:
Ship owners are waiting longer and paying more to refuel at Singapore as the industry scrambles to prepare for the implementation of new ship-fuel rules in just a few weeks.

The availability of refuelling barges has dwindled as their tanks are scoured so that they will be able to carry cleaner-burning fuels compliant with the new rules, known as IMO 2020, that take effect Jan 1.

It’s taking about two weeks to book a barge instead of the usual five days, according to shipping companies and brokers who didn’t want to be identified because they aren’t authorised to speak to the media.

The ship owners said they were also being asked to pay more due to the barge shortage, with premiums for high-sulphur fuel oil over Singapore benchmark prices doubling to US$8 to US$10 a ton since September.

Another ship owner said it hadn’t experienced delays but did have to pay more.

The longer waiting times are adding to congestion in the Melaka Strait off Singapore where a flotilla of tankers has anchored with a hoard of low-sulphur fuel that’s compliant with the IMO 2020 rules.

“There’s certainly lots of chaos with final preparations and switching,” said Randy Giveans, an analyst at Jefferies LLC in Houston.

“It’s double congestion in Singapore — some vessels are laden with very low-sulphur fuel oil as a floating storage arbitrage play, and other vessels are waiting to load their fuel tanks with either low or high-sulphur fuel oil.”

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