Q & A > Question Details
How will impending changes in marine diesel specifications affect bunker and residual fuels? Is there a long-term shift away from bunkers and residuals? Will this result in some niche opportunities for refiners?
18/03/2009 A: keith bowers, B and B Consulting, kebowers47@gmail.com
Air pollution regulations at /near ports the world over are becoming aligned and more stringent. Burning of high sulfur, high metals residual fuel oil in/near ports will not be allowed. In some cases, emissions at sea as far as 30 miles off-shore are controlled. Power sources while in-port must be low emission.
Ever larger 'container cargo' ships have single train propulsion systems drive by diesel engines because this is less costly than steam turbine or gas turbine drivers. Fuel costs are a significant portion of overall operating cost. Propulsion systems are a significant part of capital costs. Will ship owners choose multiple fuel tanks and supply systems (low sulfur, and bunker)? Or will they choose to use the higher quality fuel-and reduced fuel consumption through higher efficiency engines ?
The long term trend is clear--ever decreasing heavy fuel demand and ever lower sulfur levels in fuel.
The trend slope will vary from time to time as market dislocations happen, but long term direction is less resid fuel consumption.