To most ship operating company, a reasonable choice of oil supply solutions could reduce the operation cost of the ships. Zhoushan port with the lowest price of fuel oil is the only port inside mainland China who can provide anchorage bunkering. Compare to many other ports who can supply fuel oil such as Busan, Hong Kong, and Singapore, Zhoushan has its unique strength.
The chart below shows the oil price data’s variation in a random 50 days selected between 2018.10.1 to 2019.3.21 was provided by ship owner which is from bunker trader indication circulation Email.
The green line stands for the reference value of Zhoushan bunkering from this bunker trader. There isn't a significant difference in the price of heavy fuel oil 380CST between those ports chosen except Zhoushan bunkering’s price is slightly higher than Singapore and obviously lower than Busan. Among all the ports shown in the chart, Zhoushan ranks the highest price in MGO fuel oil.
The chart below shows the difference in the prices of fuel oil 380CST and MGO based on Singapore price.
As can be found in the data selected from a random time period of 50 days from 2018.10.1 to 2019. 3.21 in the chart, the grey line signifies the fuel oil price of 380CST compare to the price of the fuel oil in Singapore port shown as the baseline has a deviation from the lowest -7$ to the highest +30$
Based on the sample analysis of the data collected from bunker trader
illustrating the difference of oil prices in different ports within 50 days, we can easily find that the 380CST heavy fuel oil’s price of Zhoushan is apparently lower than the oil price in Busan, and the light fuel oil MGO of Zhoushan is prominently higher than Singapore for more than 100 USD.
The comparison of the supramax vessel and Capsize vessel below furtherly analyzed the impact that Zhoushan oil price has on the practical operation of the ship regarding the daily oil consumption of the ships during its voyage.
MV AKIJ HERITAGE
DEADWEIGHT: 56,055 MT ON 12.573 M DRAFT
SPEED AND CONSUMPTION AT SEA: BALLAST ABT14.00 KTS ON ABT 32.50 MT HFO 380 CST ABT & 0.1 MT LSMGO and LADEN ABT13.00 KTS ON ABT 32.50 MT IFO 380 CST ABT & 0.1 MT LSMGO FOR ME & AE.
MV SEAMATE
DWT: 177,775 MT ON 18.322 M SSW
BALLAST ABOUT 14.00 KNOTS ON ABOUT 42.0 MTIFO
LADEN ABOUT 13.5 KNOTS ON ABOUT 53.7 MT IFO
ALL PLUS 4.3 MT IFO AT SEA
MV SEAMATE
DWT: 177,775 MT ON 18.322 M SSW
BALLAST ABOUT 14.00 KNOTS ON ABOUT 42.0 MTIFO
LADEN ABOUT 13.5 KNOTS ON ABOUT 53.7 MT IFO
ALL PLUS 4.3 MT IFO AT SEA
For a Supramax vessel like AKIJ HERITAGE, the total oil consumption of MGO Daily is 0.1 Metric ton which means the operation of the ship would cost 10USD-15USD more if the ship bunkered in Zhoushan port instead of Singapore port. However, the average cost of heavy fuel oil 380CST is approximately 13812.5 USD (calculated with the average MGO price of 425 USD in the market). Therefore, the extra10-15 USD spent on MGO compare to 13812.5 USD light oil is negligible.
For a cape-sized vessel like SEAMATE, the total heavy oil consumption is around 46.3-58 Metric ton daily, which cost around 17850-22822.5 USD calculated with the average market price of 425 USD. There is no MGO consumption during its voyage.
Therefore, there isn’t too much influence caused by the difference of oil price in light oil between Zhoushan port and Singapore port in the practical operation of vessels. Moreover, Zhoushan should replace Busan position in bunkering market when vessel routes are including Zhoushan and Busan and would promote ship operation company strategies to increase vessel Time Charter Equivalent.
Source: MarineCircle News
