Published 7 December 2017
2020: a term that implies clarity of vision. And the 6th Annual Platts Mediterranean Bunker Fuel Conference held in Athens last week certainly featured numerous speakers seeming to claim 20/20 vision on 2020. Yet by the end of the conference I found my own vision to be distinctly blurry.
2020 refers of course to the sulfur content environmental restrictions to be imposed on marine fuel in just over two years’ time.
There was certainly plenty to see and hear at the Athens conference. Opinions and ideas presented were universally thoughtful but at the same time lacking a uniform vision, which is terrific in terms of diversity, but also frustrating for someone seeking clarity on the likely shape of the bunker market come 2020. Much like the mysteries of cosmos itself, every answer begat more questions.
The packed conference hall was full of 2020 clarity seekers like me, eagerly taking in the impressive roster of distinguished decision makers and experts boasting decades of market experience. The data and views they laid out in presentations and related in panel discussions demonstrated their complete confidence in their respective 2020 visions.
While their confidence matched my befuddlement, I was relieved to discover that I was far from alone. Many grumbled that the confident views expressed were not only divergent but had shifted over time. And the divergences among the experts were plentiful.
For example, one expert who had strongly touted Exhaust Gas Cleaning Systems (colloquially known as scrubbers) just a few months ago as the leading solution to dealing with the 2020 restrictions now admitted that they just weren’t catching on. More expensive fuels (0.5% sulfur content fuel oil and marine gasoil) have since become the more preferable solution, he said.
Speakers representing refiners and suppliers assured the audience that whatever direction the market ultimately took — be it scrubbers, burning compliant fuel or even simply ignoring the rules and consuming high sulfur fuel on the high seas – fuel availability wouldn’t be a problem. Others just as strongly disagreed.
There were clashing views of refinery capacity availability and differing takes on the direction of fuel prices and how the differentials between compliant and non-compliant fuel prices might play out.
Predictions ran the gamut on the likelihood of non-compliance, LNG adoption, electricity (batteries and other innovations), and the market share of high- versus low-sulfur fuels.
And yet each of the meticulously-considered predictions seemed eminently – and frustratingly — sensible.
Clarity, it seems, is both elusive and in the eye of the beholder. Perhaps somehow the market will achieve a unified, “20/20” vision before 2020 arrives — the journey towards that point promises to be an exciting and fascinating one, with a great deal of preparation clearly still required.
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Source: Platts – The Barrel Blog – 20/20 on 2020? Looking to the future for shipping