Product Code: 62667
The global bunker fuel market is expected to grow at a CAGR of more than 13% in the forecast period of 2021-2026, reaching a value of USD approximately 203 billion by 2026 up from USD 97 billion in 2019. The COVID-19 pandemic has slowed down and delayed shipping and ship crew movements in many countries and has disrupted the logistics and supply chain industry, resulting in major losses to the transportation sector, including the shipping industry. The disruption is caused on both sides, i.e. supply and demand. The slowdown is expected to result in the permanent shutdown of some industrial manufacturing facilities, resulting in reduced global manufacturing and production capacity, which is expected to have a lasting impact on global trade. This factor is expected to have a negative impact on the demand for bunker fuel. However, the increasing preference for LNG-based vessels and growing LNG trade is a significant factor in driving bunker fuels' demand during the forecast period. Moreover, with the imposed restriction on HSFO, post-2020, VLSFO is expected to create substantial market demand. However, with increasing trade tension between different countries like the United States and China, India and China, high tariffs are being imposed on various goods, due to which growth is expected to be restrained.
- With IMO's intervention to decrease the share of high sulfur fuel oil, the demand for LNG as bunker fuel is expected to rise significantly during the forecast period.
- Low sulfur fuel oil and LNG are expected to create ample opportunities for the market players. Due to the increasing environmental concern, the demand for cleaner fuel is increasing in the shipping industry across the globe.
- Asia-Pacific is one of the largest exporters of goods globally and is leading the market for bunker fuel as of 2019. With the expected growth in maritime trade, the region is likely to continue its dominance during the forecast period.
Key Market Trends
LNG as Bunker Fuel to Witness Significant Growth
- The global LNG bunkering market evolved over the past decade, driven by the growth in global LNG usage, clean energy demand, and its ability to reduce greenhouse gas emissions. The order and delivery of LNG-powered vessels are increasing, and the reduced natural gas prices in 2014 marked the beginning of expanding opportunities for such vessels.
- The conversion of the current operating vessels into LNG-based vessels is costly. Hence, it is not economically viable in developing nations. However, LNG-based vessels' operational cost is expected to be the least among all the fuel alternatives as the new emission regulation is being implemented.
- Further, a gradual shift to LNG for propulsion is more advantageous than the traditional methods of fueling ships with heavy fuel oil, marine gas oil, marine diesel oil, etc. LNG-based propulsion reduces carbon footprint significantly and increases the ship's operational efficiency.
- According to a report published in 2020, there are 175 LNG-fueled ships in operation, and 207 in order books. This indicates the shipping industry's commitment to the adopt LNG as a marine fuel across the globe.
- However, the LNG-fueled ships have not penetrated the market for bulk carriers to a significant extent. These ships are designed to carry heavy loads, and LNG technology is relatively new to apply for this type of vessel. The bulk carriers amount to the largest share of the in-operation ships across the globe as of 2019.
Asia-Pacific to Dominate the Market
- Asia-Pacific is expected to dominate the bunker fuel market due to the immense maritime trade potential of countries like India, China, Singapore, Japan, and others.
- As of 2020, China is the biggest exporter and the second-largest importer of goods by value. China's major exports are mechanical and electric machinery and equipment, automotive products including vehicle parts, chemicals and plastics, iron and steel articles, furniture, etc.
- Australia is among the biggest exporter of LNG globally. The rising LNG exports supported the international trade of Australia in 2019. As a result, the country was among the few economies to register a growth in exports by value as well as volume in 2019, in turn, driving the marine trade and bunker fuel market.
- To increase the share of the marine sector in international and domestic trade, the Indian government announced an investment of USD 22 billion by 2035 to modernize the existing ports and build new ports. The port infrastructure development is expected to be a significant driver for the maritime industry and marine fuel during the forecast period.
- However, the COVID-19 pandemic resulted in restricted trade in 2020 throughout Asia-Pacific. Due to this, total cargo throughput in Singapore reduced to 590 million metric tons compared to 626 million metric tons in 2019. This, factor, in turn, is expected to restrain the growth of the market in 2020.
The bunker fuel market is moderately consolidated. Some of the major players in the market include Chevron Corporation, Exxon Mobil Corporation, Royal Dutch Shell Plc, Total S.A., BP Plc, and others.
Reasons to Purchase this report:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
TABLE OF CONTENTS
- 1.1 Scope of the Study
- 1.2 Market Definition
- 1.3 Study Assumptions
2 EXECUTIVE SUMMARY
3 RESEARCH METHODOLOGY
4 MARKET OVERVIEW
- 4.1 Introduction
- 4.2 Market Size and Demand Forecast in USD billion, till 2026
- 4.3 Recent Trends and Developments
- 4.4 Government Policies and Regulations
- 4.5 Market Dynamics
- 4.5.1 Drivers
- 4.5.2 Restraints
- 4.6 Supply Chain Analysis
- 4.7 Porter's Five Forces Analysis
- 4.7.1 Bargaining Power of Suppliers
- 4.7.2 Bargaining Power of Consumers
- 4.7.3 Threat of New Entrants
- 4.7.4 Threat of Substitutes Products and Services
- 4.7.5 Intensity of Competitive Rivalry
5 MARKET SEGMENTATION
- 5.1 Fuel Type
- 5.1.1 High Sulfur Fuel Oil (HSFO)
- 5.1.2 Very Low Sulfur Fuel Oil (VLSFO)
- 5.1.3 Marine Diesel Oil (MDO)
- 5.1.4 Liquefied Natural Gas (LNG)
- 5.1.5 Others
- 5.2 Vessel Type
- 5.2.1 Containers
- 5.2.2 Tankers
- 5.2.3 General Cargo
- 5.2.4 Bulk Carrier
- 5.2.5 Others
- 5.3 Geography
- 5.3.1 North America
- 5.3.2 Asia-Pacific
- 5.3.3 Europe
- 5.3.4 South America
- 5.3.5 Middle-East and Africa
6 COMPETITIVE LANDSCAPE
- 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
- 6.2 Strategies Adopted by Leading Players
- 6.3 Company Profiles
- 6.3.1 Exxon Mobil Corporation
- 6.3.2 Royal Dutch Shell Plc
- 6.3.3 Gazpromneft Marine Bunker LLC
- 6.3.4 BP PLC
- 6.3.5 Lukoil-Bunker LLC
- 6.3.6 Chevron Corporation
- 6.3.7 AP Moeller Maersk A/S
- 6.3.8 Mediterranean Shipping Company SA
- 6.3.9 Total SA
- 6.3.10 China COSCO Holdings Company Limited
7 MARKET OPPORTUNITIES AND FUTURE TRENDS