Singapore B30 biofuel demand muted 3 months after carriage limit raised

Singapore bunker fuel buyers and sellers remained hesitant to transition from B24 to B30 biobunker blends, even after the Maritime and Port Authority of Singapore raised the biofuel carriage limit on conventional oil tankers to 30% from March 7. The move aimed to address logistical challenges that could hinder adoption, market sources told Platts, part of S&P Global Commodity Insights, during the week of June 9-13.

The MPA's decision preceded the International Maritime Organization's official approval to increase carriage limits to 30% from 25% at the 83rd Marine Environment Protection Committee (MEPC) session in April.

High premiums and unfavorable blending economics continued to pose significant hurdles for buyers and suppliers, the sources said.

In the week following Singapore's shift to B30, B30 LSFO valuations were assessed at a premium of $260-$280/mt over the Platts benchmark FOB Singapore Marine Fuel 0.5%S cargo assessments. This marked a steep premium compared to the predominant B24 LSFO grade, which was indicatively priced at $180-$190/mt during the same period.

Some major shipping liners had already committed to using B24 for the year to meet emission targets and were reluctant to deviate from their biobunkering plans.

A supplier noted that dedicating additional storage tanks for B30 would not be economical given the small and inconsistent volumes currently being inquired.

Although actual demand for B30 remained limited, interest and inquiries for higher biofuel blends have grown since late 2024, according to several market participants.

In a recently concluded biobunkers third and fourth-quarter term tender, B30 was included in supply requirements. The B24 LSFO component was reportedly fixed at a premium of $190-$200/mt over the Platts benchmark FOB Singapore Marine Fuel 0.5%S cargo assessments, while the B30 LSFO component was fixed at a premium of $240-$250/mt. The B30-to-B24 LSFO spread narrowed to $50-$60/mt from March.

"The B30 market is more liquid now, so B30 [price] levels are more competitive," a Singapore-based trader said.

In light of stricter upcoming decarbonization compliance, including the IMO's Greenhouse Gas GHG Fuel Intensity (GFI) targets, the incentive to lift higher biofuel concentration blends is anticipated to grow, owing to the higher emissions reduction they would be entitled to.

Platts assessed Singapore-delivered B24 low-sulfur biobunkers at a premium of $196/mt over the Platts benchmark FOB Singapore Marine Fuel 0.5%S cargo assessments on June 13.

Platts assessed Singapore-delivered B24 high-sulfur biobunkers at a premium of $204/mt over the FOB Singapore 380 CST 3.5%S fuel oil cargo assessments on June 13.