Bunker fuel market

Global bunker fuel market was valued at US$ 26.93 Billion in 2022 in terms of revenue, exhibiting a CAGR of 7.1% during the forecast period (2023 to 2030).

Drivers

• Increasing demand for bunker fuel in the shipping industry and

The increased development of hydrocarbon resources in offshore locations is boosting demand for bunker fuel. Rapidly expanding exploration operations, together with the increasing formation of new hydrocarbon reserves, have resulted in an increase in offshore and onshore reserves. Furthermore, increased oil and gas exploration operations in deep offshore locations are expected to boost bunker fuel market growth.

• Exploration activities to boost the market growth

The conversion of current working vessels to LNG-powered vessels is too expensive. As a result, it is not commercially viable. However, once the new pollution laws take effect, the operational costs of LNG-powered vessels are likely to be the lowest of any fuel choice. Furthermore, a gradual transition to LNG for propulsion is more advantageous than traditional methods of fueling ships with heavy fuel oil, marine gas oil, marine diesel oil, and so on. LNG-powered propulsion greatly reduces the ship's carbon footprint while increasing operational efficiency. For instance, in February 2020, Lukoil Marine Bunker Ltd. (a Lukoil affiliate) purchased G. Puccini and G. Rossini, two bunkering tankers that would operate in Big Port St. Petersburg. This will help the company's reputation.

Global Bunker Fuel Market- Impact of Coronavirus (Covid-19) Pandemic

Several refineries have reduced supply of petroleum coke due to refinery production cuts, falling consumption of gasoline and jet fuel amid the coronavirus pandemic. The prices of petroleum coke has fallen due to low crude oil prices. End-use industries can benefit from low petroleum coke prices and help to increase the profit margins of global bunker fuel companies. In March 2020, the Chinese Ministry of Finance offered tariff exemptions on U.S. petcock imports as impact of COVID-19 affected domestic petcock production in the country. According to Coherent Market Insights, in 2020, petroleum coke market is expected to grow at a lower CAGR between 2020 and 2021.021.

Market Restraints

• Strict regulation regarding usage of bunker fuel as these contain pollutants such as sulphur and nitrogen

Increasing fuel conservation attempts by the shipping industry in response to increased environmental concerns and the need to reduce carbon footprint are likely to stymie market expansion. For this shipping business, efficient technologies (MGO- Marine Gas Oil, MDO- Marine Diesel Oil, IFO- Intermediate Fuel Oil, MFO- Marine Fuel Oil, HFO- Heavy Fuel Oil) are being adopted, which can help to cut fuel consumption.        

• Market Trends

Manufacture are in innovation  

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 2020, 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, product innovation by key manufacturers is expected to foster the market growth.

Market segment

Figure 1. Bunker Fuel Market, By Vessel in 2022

On the basis of vessel type in 2022, the bulk & general cargo segment has accounted the largest market share of 43.30% in terms of value, followed by tankers and container segment respectively.

Figure 2.  Bunker Fuel Market, By Region in 2022

On the basis of region type in 2022, Asia pacific region has accounted the largest market share of 39.30% in terms of others, followed by North America, Latin America, Europe, and Middle East & Africa respectively.

Recent Developments

• In January 2022, Titan LNG, a leading, independent and physical LBM and LNG supplier gained the tender for the delivery of LNG in the Port of Marseille for Corsica Linea's new Ro-Pax LNG fueled ferry. This partnership indicates the expansion of Titan LNG's operation into the Mediterranean will enhance the availability of LNG, bioLNG, and in the longer run, hydrogen-derived LNG in the region.
• In December 2021, at the Red Sea ports of Yanbu and Jeddah in Saudi Arabia, Minerva Bunkering an manufacture began selling marine fuels. The business is partnered with Aramco Trading and the Saudi Arabian Energy Ministry and is owned by Mercuria Energy Group.
• In May 2021, According to the Ministry of Transport of the People’s Republic of China, in 2021, Shanghai port topped in the container throughput, reaching over 47.03 million TEU witnessing an increase of 8.1% compared to 2020 levels.
• In March 2022, the first marine bio-VLSFO (very low sulfur fuel oil) bunker delivery was carried out by TotalEnergies Marine Fuels at Singapore port’s waters. The delivery was part of NYK Line and Anglo American’s recently completed biofuel trial. The delivery was supplied to the MT Friendship via a ship-to-ship transfer and consisted of a B10 biofuel blend made up of VLSFO blended with 10% second-generation, waste-based and ISCC-certified UCOME (used cooking oil methyl ester). The biofuel was used during the vessel’s two-way trip between Singapore and Saldanha Bay in South Africa.

Competitive Section

• Major players operating in the global bunker fuel market include 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

*Definition- Bunker fuel is meant to be used by the shipping industry for fueling its marine fleet. 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.

Detailed Segmentation:

• Global Bunker Fuel Market, By Fuel Grade:
  • IPO 380
  • IPO 180
  • IPO Others
  • MDO/MGO
• Global Bunker Fuel Market, By Vessel type:
  • Tankers
  • Containers
  • Bulk & General Cargo
  • Others
• Global Bunker Fuel Market, By Seller:
  • Major Oil Companies
  • Leading Independent Distributors
  • Small Independent Distributors
• Global Bunker Fuel Market, By Region:
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Mexico
    • Rest of Latin America
  • Europe
    • U.K.
    • Germany
    • France
    • Italy
    • Spain
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • ASEAN
    • Australia
    • South Korea
    • Rest of Asia Pacific
  • Middle East & Africa
    • Middle East
    • Africa