06SEP2019 - NEWS - Cheaper compliant fuel oil stalks gasoil's lead in IMO 2020 switch

When new global rules limiting the amount of sulphur in shipping fuels were announced, marine gasoil (MGO), a type of diesel fuel used on ships, was declared the early winner since most types readily met the new 0.5% limit on sulphur content.

But with only about 100 days before the International Maritime Organization’s (IMO) rules start, analysts and traders agree that the scale of the MGO demand swing will not be as great as expected.

Instead, very-low sulphur fuel oil (VLSFO) has emerged as a dark horse to challenge MGO as a replacement for high-sulphur fuel oil, with a 3.5% sulphur limit, once the switch begins in 2020.