HONG KONG bunker suppliers expect up to 20 per cent more inquiries from shipmanagers who have had fuel contracts cancelled after the world's largest supplier announced its bankruptcy in Singapore, Reuters reports.
Bunker men expect ships to fuel in Hong Kong after Singapore scandalHONG KONG bunker suppliers expect up to 20 per cent more inquiries from shipmanagers who have had fuel contracts cancelled after the world's largest supplier announced its bankruptcy in Singapore, Reuters reports.
Hong Kong's 380-cst marine fuel was at least US$10 a tonne cheaper than that in Singapore, on a delivered basis.
OW Bunker, a leading supplier of marine fuel oil, filed for bankruptcy in Denmark a week ago after it revealed losses of at least $125 million at Dynamic Oil Trading, prompting banks to refuse to provide new credit lines.
Bunker prices in Singapore have hit their highest in two years as tightening of credit led to a supply crunch as demand soared after the fall of OW Bunker amid charges of fraud being levelled at still unnamed employees in Singapore.
"My impression is enquiries have gone up 20 per cent, though it's hard to put a figure to it. There were more prompt orders for delivery between five to 10 days," said a Hong Kong-based marine fuel seller.
Delivered marine fuel oil in Singapore was priced at least $8 a tonne above oil lifted from terminals, traders said, a trend rarely seen previous as wary sellers now factor in risks of default.
Because of the sheer size of Singapore's bunker fuel market, with close to 43 million tonnes of oil sold last year, there are more companies supplying ship fuel than the 63 bunker fuel companies licensed by Maritime Port Authority (MPA), traders said.
"Small traders, who used to rely on open credit or sleeving are the ones suffering the most," a bunker fuel trader in Singapore said.
Smaller players act as retailers, borrowing credit lines and bunker delivery notes from big companies that act as middlemen for a fee, and using the credit buy fuel oil for delivery to shipowners, said Reuters.
