The global bunker fuel market comprises fuel oils that are specifically produced for marine shipping and freight carriers, including tankers, bulk carriers, general cargo ships, container ships, and other cargo ships. Bunker fuel oils are typically composed of residues left over from petroleum refining processes and they provide a concentrated form of energy needed to power vessel engines and generators over long transits across oceans and seas. With unmatched energy density, bunker fuels enable shipowners and operators to transport large volumes of goods and raw materials internationally in a cost-effective manner.
The global bunker fuel market is estimated to be valued at US$ 150 Billion in 2023 and is expected to exhibit a CAGR of 6.6% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the key trends driving growth of the bunker fuel market is stringent regulations aimed at reducing pollution from maritime transportation. The International Maritime Organization (IMO) has implemented regulations to curb emissions of sulfur oxides (SOx) from ships by setting a global sulfur cap of 0.50% m/m (mass/mass) on marine fuel starting January 1, 2020. This is projected to significantly boost demand for low sulfur bunker fuels compliant with the IMO 2020 rules from ship owners and operators globally. Additionally, the IMO has proposed a 50% reduction in total annual GHG emissions from international shipping by 2050 as compared to 2008 levels. Such regulations will promote transition toward use of cleaner but more expensive fuels like liquefied natural gas, which is expected to gain market share in the coming years at the cost of high sulfur fuel oil.
Porter's Analysis
Threat of new entrants: The threat of new entrants is moderate. Bunker fuel is a commodity market and barriers to entry are moderately low. However, existing players have established supply chains and brand recognition.
Bargaining power of buyers: The bargaining power of buyers is high. The bunker fuel market has many buyers and not many suppliers. Buyers can negotiate lower prices and demand better terms.
Bargaining power of suppliers: The bargaining power of suppliers is moderate. While there are few global suppliers, local suppliers face intense competition. Suppliers still have some control over pricing and produce differentiated products.
Threat of new substitutes: The threat of new substitutes is low. There are no cost-effective or widely available alternatives to bunker fuel for powering marine vessels at scale in the near future.
Competitive rivalry: Competition in the global bunker fuel market is high with the presence of key players. Players compete based on pricing, quality, and supply chain reach.
Key Takeaways
The global bunker fuel market is expected to witness high growth.
Regional Analysis: The Asia Pacific region accounts for over 50% of the global bunker fuel demand led by countries such as China, Singapore, India and Japan. Strong economic growth and increasing import/export volumes have increased the use of marine vessels. Southeast Asia and the Middle East are also major bunker fuel hubs due to strategic port locations on international trade routes.
Key players: Key players operating in the bunker fuel market are ExxonMobil, BP, Shell, China Marine Bunker, Bunker Holding, Total, Sinopec, and Gazpromneft. Players are investing in expanding bunkering infrastructure and pursuing partnerships with global maritime companies for new supply contracts.
For more Insights, Read –
https://www.marketwebjournal.com/bunker-fuel-market-market-size-and-share-analysis/
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