Insight

Smooth sailing or rough seas? Updated analysis of the IMO bunker sulphur changes

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Summary

The forthcoming change in IMO regulations on the quality of marine bunker fuel impacts the mix of fuel types consumed by the shipping sector in 2020. The IMO Marine Environment Protection Committee met again in July 2017 (MEPC 71) but many uncertainties surrounding the implementation path for the legislation remain. This insight summarises our latest view providing an update on the article published in early 2017. Our base case assumptions on compliance scrubber penetration and ULSFO availability remain largely unchanged. The insight provides our latest forecasts for bunker fuel prices and crude differentials consistent with our H1 2017 Brent price forecast and global refined product imbalances. We have added a forecast for the ULSFO crack spread in this latest edition. And we also provide new commentary on the risk of established bunkering hubs losing market share as the IMO regulations have implications for relative regional marine fuel pricing and supply.

What's included

This report contains

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    Smooth sailing or rough seas - Updated analysis of the IMO bunker sulphur changes.pdf (1)

    PDF 1.84 MB

  • Document

    Smooth sailing or rough seas - data and charts.xls (1)

    XLS 431.00 KB

  • Document

    Smooth sailing or rough seas? Updated analysis of the IMO bunker sulphur changes

    ZIP 1.77 MB

Why buy this report?

This study presents a detailed analysis of what the IMO's regulations on sulphur content beginning in 2020 mean for your business. Whether you're a crude producer, refiner, or shipper, this report will help you:

  • Understand how the sulphur regulations will affect the crude market and its shipping supply chain
  • Identify unique risks and upside specific to your role in the shipping industry
  • Prepare for upcoming regulatory changes with a deep knowledge of how they could affect the markets

Our expert analysts in refining, chemicals and oil markets research are local to the markets they study. Wood Mackenzie has more than 20 years' experience identifying trends and risks in refining and oil markets.

This study offers detailed insight into the IMO's forthcoming regulatory specifications. It includes:

  • Assumptions and modelling on compliance, scrubber penetration and ULSFO availability
  • Our latest forecasts for bunker fuel prices and crude differentials
  • Commentary on the risk of established bunkering hubs losing market share
 
Michael Wojciechowski, VP Refining and Oil Markets Research, discusses what impacts and opportunities crude producers face as they move toward 2020.

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