Impact Analysis of Covid-19
The complete version of the Report will include the impact of the COVID-19, and anticipated change on the future outlook of the industry, by taking into the account the political, economic, social, and technological parameters.
Bunker fuel is meant to be used by the shipping industry for fueling its marine fleet. Fuel oil is mostly used as a bunker oil in shipping industry. Bunker fuel is classified into distillates and residual fuel oils. In general term bunker fuel is any fuel that is burned in boiler or furnace for the generation of power in the engine.
The global bunker fuel market is projected to reach around US$ 399.59 billion by the end of 2027, in terms of revenue, growing at CAGR of 4.6% during the forecast period (2020-2027).
Increasing hydrocarbon resources development activities in offshore areas is driving demand for bunker fuel. Rapidly growing exploration activities coupled with the rising establishment of new hydrocarbon reserves has increased offshore and onshore reserves. Moreover, growth in the oil &gas exploration activities at the deep offshore location is further anticipated to augment the market growth of the bunker fuel.
Figure 1. Global Bunker Fuel Market Share (%) in terms of Value, By Region, in 2019
Asia Pacific region dominated the global bunker fuel market in 2019, accounting for 39.3% share in terms of value, followed by Europe and Middle East & Africa, respectively.
Increasing fuel reduction initiatives by shipping industry subjected to rising environmental concern and reducing carbon footprint is expected to hamper the market growth. For this shipping industry are adopting efficient technologies that help to reduce the consumption of fuel.
Bunker Fuel Market Report Coverage
||Market Size in 2019:
||US$ 278.81 Bn
|Historical Data for:
||2016 to 2019
||2020 to 2027
|Forecast Period 2020 to 2027 CAGR:
||2027 Value Projection:
||US$ 399.59 Bn
- North America: U.S., Canada
- Latin America: Brazil, Argentina, Mexico, Rest of Latin America
- Europe: Germany, U.K., Spain, France, Italy, Russia, Rest of Europe
- Asia Pacific: China, India, Japan, Australia, South Korea, ASEAN, and Rest of Asia Pacific
- Middle East & Africa: Middle East and Africa
- By Fuel Grade: IFO 380, IFO 180, IFO Others, and MDO/MGO
- By Vessel Type: Tankers, Containers, Bulk & General Cargo, and Others
- By Seller: Major Oil Companies, Leading Independent Distributors, , and Small Independent Distributors
Chemoil Energy Limited, Aegean Marine Petroleum Network, Inc., World Fuel Services Corporation, Gulf Agency Company Ltd., Gazpromneft Marine Bunker LLC, BP Marine Ltd., Exxon Mobil Corporation, Royal Dutch Shell plc, Bunker Holding A/S, and Lukoil-Bunker LLC
- Increasing hydrocarbon resources development activities in offshore areas
- Rapid industrialization and urbanization across developing countries
|Restraints & Challenges:
- Strict regulation regarding usage of bunker fuel as these contain pollutants such as sulfur and nitrogen
Increasing production of bunker oil for the shipping industry is expected to offer potential market opportunities over the forecast period. For instance, in March 2020, Sinopec has announced that its Guangzhou refinery has started producing very low sulfur fuel oil (VLSFO) for the shipping market. Thus, growing production of the bunker fuel to cater to rising demand around the globe is projected to favor the market growth in the near future.
The rising number of naval fleet across countries such as China, Brazil, Russia, and the U.S. is expected to offer new market opportunities in the near future. Increasing use of bunker fuel for refueling during sailing is also expected to raise demand for this fuel. Moreover, the growing demand for tanker vessels for trading liquid materials around the globe is further projected to propel the market growth of the bunker fuel.
Figure 2. Global Bunker Fuel Market– Opportunity Analysis
Product innovation by key manufacture in marine fuel is a growing trend in the market and this is expected to augment the market growth of bunker fuel. For instance, in August 2019, Neste has announced the launch of low-sulfur marine fuels to help ships meet upcoming International Maritime Organization (IMO) regulations on sulfur dioxide emissions. Thus, continues product innovation by key manufacturers is expected to foster market growth.
Figure 3. Global Bunker Fuel Market Share (%) in terms of Value, By Vessel Type, in 2019
On the basis of vessel type in 2019, the bulk & general cargo segment has accounted the largest market share of 43.3% in terms of value, followed by tankers and container ships segment respectively.
Global Bunker Fuel Market - Impact of Coronavirus (Covid-19) Pandemic
Curtailment of global economic activity has put a break on fuel oil use for shipping. As a result of Covid-19, container trade volumes and container port volumes have declined for first months of 2020. According to International Transport Forum, global container trade volumes declined by 8.6% in February 2020 compared to same month of 2019. The main response of carriers to falling demand has been to reduce supply. Ship operators have massively started idle vessels by cancelling services. According to International Transport Forum, The share of idle container ship capacity reached 2.5 million Twenty-foot Equivalent Units (TEU) or 10.6% of capacity in early March 2020. This is expected to reduce demand for marine fuels. According to Coherent Market Insights, bunker fuel market is expected to grow at a lower CAGR between 2020 and 2021.
- Chemoil Energy Limited
- Aegean Marine Petroleum Network, Inc.
- World Fuel Services Corporation
- Gulf Agency Company Ltd.
- Gazpromneft Marine Bunker LLC
- BP Marine Ltd.
- Exxon Mobil Corporation
- Royal Dutch Shell plc
- Bunker Holding A/S
- Lukoil-Bunker LLC
Few Recent Developments
In January 2017, Aegean Marine Petroleum Network Inc. announced the launch of a new service center in Rostock. The operations at Rostock will be managed by the existing team at OBAST Bunkering & Trading GmbH (“OBAST”), a physical bunker supplier, and cargo oil trader.