Bunker fuel is the marine petroleum used to power ocean-going ships — cargo vessels, tankers, bulk carriers, container ships, and cruise liners. The global bunkering market consumes approximately 250–300 million metric tonnes annually, making it one of the world's largest petroleum product markets.
Since IMO 2020 (January 1, 2020), the global sulphur cap of 0.5% has fundamentally restructured this market. VLSFO (Very Low Sulphur Fuel Oil) is now the dominant marine fuel for open-ocean operations, while HFO 3.5% continues to be used on vessels fitted with exhaust gas scrubbers (EGCS).
Key Bunker Price Drivers
- Brent crude — bunker price correlates at roughly 0.65–0.70× Brent on a $/MT basis
- VLSFO crack spread — processing margin for compliant low-sulphur fuel
- Port congestion — Singapore, Rotterdam delays affect local supply/demand
- Baltic Dry Index (BDI) — shipping activity proxy, correlates with bunker demand
- Scrubber economics — HFO/VLSFO spread determines scrubber payback period
- LNG competitiveness — dual-fuel newbuilds watch Henry Hub and TTF gas prices