Speakers at a bunker conference Tuesday in Fujairah in the UAE, the world's second largest bunkering hub, said it faced challenges from the lower global sulfur cap on marine fuels in 2020, but expressed confidence it could adapt to meet them.
A live poll conducted at the 10th International Fujairah Bunkering & Fuel Oil Forum (FUJCON 2017) asked delegates what the impact on fuel oil demand in Fujairah would be as a result of the lower sulfur cap in 2020; 53% of respondents said fuel oil demand will fall significantly, 40% said demand would fall marginally, while only 5% said demand for fuel oil would rise, and 3% said there would be no effect.
However, panelists downplayed the risk to the Fujairah storage and bunkering industry.
Cockett Marine Oil DMCC CEO Cem Saral said demand for all types of marine fuel oil would not fall in 2020 in Fujairah, even if the share of residual fuel in this mix were reduced.
More refineries in the region producing lighter ends would have a positive impact on demand for marine fuels in Fujairah, Saral added.
"There's a lot of talk that as a result of the 2020 sulfur cap, fuel oil tank operators in Fujairah will suffer -- but fuel oil tanks can still handle low sulfur [0.5%] fuel, it's still a class three product. Traders will have to find a source for the low sulfur fuel oil, but then they can carry on bunkering as normal," Fujairah Oil Terminal's commercial director Malek Azizeh said.