What Is Bunker Fuel? A Complete Guide

If there’s one thing the maritime industry can’t do without, it’s bunker fuel. It’s what powers the world’s shipping fleet and helps convey 90% of traded goods across the world’s oceans. But, what exactly is it? What are the bunker trends that you need to know? Keep reading and Brookes Bell will provide you with the answers…

What is bunker fuel? 

What exactly is bunker fuel? In the broadest sense, bunker fuel refers to any fuel that is used on a ship. 

The name ‘bunker fuel’ derives from the age of steam ships, when the coal used to fuel vessels was stored in coal bunkers onboard. Hence, bunker fuel!

Bunker fuels are part of a broader family of fuels known as ‘fuel oils’. 

These fuel oils can be divided into two broad categories: 

• Distillates.
• Residuals.

What are distillate fuel oils?

Distillate fuel oils are those produced by conventional distillation only and are cleaner burning. 

Examples of the distillate fuel oils included in ISO 8217: 2017 are category ISO-F- DMX, DMA, DMZ and DMB fuels.  In addition there are categories ISO-F-DFA, DFZ AND DFB that can contain up to 7% fatty acid methyl ester (FAME).

What are residual fuel oils? 

Residual fuel oil components used for blending are what remains after the refining process of crude has removed the lighter and more valuable components. As a result, these fuels are cheaper, but they tend to be more viscous and are more likely to contain contaminants compared to distillate fuel oils.

Residual fuel oils have different categories (based on the viscosity). The most common category of residual fuel oil that you’ll find in charterparties is category ISO-F-RMG380.

How is bunker fuel specified? 

Like any commodity, bunker fuels are bought and sold every day. And, like any commodity, bunker fuels are refined to certain specifications. 

Because they are refined and blended to produce a fuel to a set specification, bunker fuels can be theoretically traded safely in the knowledge that they’ll be suitable for use in marine applications. 

In other words, purchasers should know what they’re going to get.

But, who sets these specifications? Since the late-1980s, it’s been the International Organisation for Standardisation (ISO). 

The specification created by the ISO for bunker fuels is ISO 8217, the latest version of which is ISO 8217:2017.

ISO 8217 sets out the requirements for both marine distillate and marine residual fuels, stipulating the tests that should be carried out to determine whether a sample meets those requirements.

As per the ISO themselves, the standard, ‘specifies the requirements for fuels for use in marine diesel engines and boilers, prior to conventional onboard treatment (settling, centrifuging, filtration) before use.

The range of tests that can be carried out to ensure a bunker fuel meets the ISO 8217 standard depends on whether it is a distillate or a residual grade and for residual fuel can include kinematic viscosity, density at 15ºC, sulphur content (statutory limit), flash point, carbon residue, pour point, water, ash, Total Sediment Potential (TSP) and more. 

Other tests, such as cetane index, oxidation stability, cloud point and lubricity are only applicable to distillate fuels. 

Table 1 and Table 2 of ISO 8217:2017 contain the characteristics and limits for distillate and residual oils respectively.

However, as we’ve written previously, just because a bunker fuel is compliant with Table 1 or Table 2 does not necessarily mean there is no risk associated with using it.  This is because the characteristics in Table 1 and 2 tell you little of the chemical composition of a fuel. Thus in some instances, particularly residuals can contain contaminants which will not be identified by routine analysis to Table 2 requirements. 

That makes it all the more important for vessel owners and operators to call on expert advisors when it comes to bunker fuel oil quality issues.

What is bunkering?

If you’ve been around the maritime industry for any length of time, then you’ve probably heard the term ‘bunkering’ being used. 

What does it mean?

Whilst there isn’t an ‘official’ globally-agreed upon definition, bunkering is considered to refer to the process of stemming fuel to a ship. 

Bunkering encompasses the logistics of loading and distributing fuel throughout a ship’s fuel tanks.

Bunker fuels can be loaded onto vessels in a number of ways: 

• From a ‘bunker barge’, whereby a ship pumps fuel oil from its own tanks into a receiving vessel. 
• Via the shore, where a bunker hose connected to a pipeline installation, shore storage tank, or a tank truck supplies fuel to a ship.

What bunker fuel is used for large ocean-going vessels? 

Traditionally, residual marine fuel oil has been the fuel of choice for the world’s largest container ships, bulkers, and other vessels. 

Being the remnants of the refining process and often blended, marine residual fuel is considered to be the ‘crudest’ and ‘dirtiest’ of the fuel oils that are used at sea. 

Fuel oil has a tar-like consistency and typically contains various compounds such as aromatics, sulphur, nitrogen, and wax. It’s because of wax in fuel oils that some fuel oil has to be heated in order to maintain sufficient viscosity. 

Because residual fuel oils sit at the residual end of the fuel oil spectrum, it has a much lower cost than distillate alternatives (as much as 30% cheaper according to some estimates). That makes a big difference when one of the biggest costs of a voyage is the fuel bill. 

As such, HFO has been keeping the world’s biggest ships moving. As of 2020, around 60% of the world’s ocean-going large vessels were using HFO.

But, things are changing…

Bunker fuel pollution concerns

With concerns about global warming rising in recent decades, attention was increasingly being drawn to the emissions related to international shipping.

In particular, environmental activists were concerned with the levels of sulphur within HFOs used by ships. 

This led to the establishment of Sox Emission Control Areas (SECAs), in various locations across the globe. These zones represent areas where strict controls were put in place to minimise airborne emissions from ships (as defined by Annex VI of the 1997 MARPOL Protocol).

These emissions zones came into effect in 2005 and included: 

• The Baltic Sea.
• The North Sea (inc. the English Channel).
• The North American ECA (which included most of the US and Canadian coast).
• The US Caribbean ECA. 

In emission control zones, to comply with current requirements (0.10% from 1 January 2015), distillate fuels such as DMA having a sulphur content less than 0.10% are used. 

IMO 2020

With effect from 1 January 2020, Annex VI of the 1997 MARPOL Protocol also lowered the limit on sulphur of 0.50% in fuel oils outside of emission control zones from 3.50% to 0.50% unless a vessel is equipped with a scrubber.

This represented a landmark event for the bunker industry, with major changes required. 

Shipping companies were able to become compliant with the IMO 2020 regulations by: 

• Switching to low-sulphur compliant fuel oil.
• Switching to alternative fuels such as liquified natural gas (LNG), or biofuels such as methanol.
• Using approved exhaust gas cleaning systems (also known as ‘scrubbers’), which clean a ship’s emissions before they are released into the atmosphere. (The use of an exhaust gas scrubber must be approved by the ship’s flag state).

The new generation of low-sulphur shipping fuels

Although work had been underway on low-sulphur fuel oils for several years, IMO 2020 naturally accelerated these efforts. 

The result of these efforts include ultra-low sulphur fuel oil (ULSFO) and very-low sulphur fuel oil (VLSFO).

These new low-sulphur fuel alternatives often differ from traditional residual marine fuels. 

For example, some of these fuels will fit into the distillate table of the ISO 8217 standard, with the exception of just one or two parameters (e.g. they exceed the maximum 11 cSt viscosity limit to meet a distillate specification). 

In other words, the main distinction fuel suppliers (and their customers) are having to make when it comes to defining these new low-sulphur fuels, is whether they should be classed as a residual marine (RM) fuel, or a distillate marine (DM) fuel. 

These definitions have important consequences - most notably, whether these new fuels require heating or not. 

What is ultra-low sulphur fuel oil (ULSFO)? 

So, what exactly is ULSFO? As we’ve mentioned above, ULSFO doesn’t neatly fit into the traditional set of marine fuel classifications, but that doesn’t mean it’s a completely unorthodox fuel, either. 

Whilst residual marine fuel oils can be ‘de-sulphurised’ to reach the 0.10% sulphur content required for use in ECAs and SECAs, the reality is that this process is prohibitively expensive. 

As a result, many ULSFOs are forms of marine gas oil composed predominantly of distillates having a maximum sulphur content of 0.10% (m/m). It must be noted that even these fuels do tend to have some residual streams within the final blend.

Companies like Shell are already offering ULSFOs which are designed to be used by engines rated to use ISO 8217 residual fuels. 

What is very-low sulphur fuel oil (VLSFO)?

Very-low sulphur fuel oils are typically made from a blend of suitable residuals and low-sulphur distillates. 

Some VLSFOs can contain as much as 40% residues, whilst remaining below the IMO’s 0.50% (m/m) sulphur limit.

Alternative fuels for global shipping

Aside from the low-sulphur fuels detailed above - which are effectively new blends of fuel oils - many shipping companies are adopting radically new fuel sources, including LNG and biofuels. 

LNG

Liquefied natural gas (LNG) contains an exceptionally low level of sulphur (far below the IMO limit), which at face value makes it an attractive alternative fuel for shipping. 

However, the practicalities of LNG - liquefying natural gas to minus 162ºC - and the subsequent requirement to use fuel tanks that are two to three times larger than conventional ones - make the use of LNG a more challenging prospect. 

There’s also the associated costs of installing engines that can use LNG. 

If you think the alternative is to build LNG-fuelled ships from scratch, this still has significant cost implications. According to estimates from Mitsui O.S.K. Lines, the cost of constructing a new LNG-fuelled vessel is between 15 and 30% higher compared to traditionally-fuelled vessels.

Biofuels

For many maritime-industry commentators, biofuels are the most ‘technologically ready’ of the alternative fuels currently being explored by the industry. 

As their name suggests, biofuels are produced by converting either primary biomass, or biomass residues, into liquid or gaseous fuels. 

At present, the majority of biofuels used in shipping are a form of biodiesel. This biodiesel usually takes one of two forms: 

• Fatty acid methyl esters (FAME).
• Hydro-treated vegetable oils (HVO).

Whichever one you choose, you’ll find that it uses plant oils as their primary feedstock. However, with more regulation (particularly in Europe), you are increasingly likely to find second generation (waste-based) biofuels in use. In other words, these are biofuels that use waste-based plant oils as their primary feedstock.

Whilst these biofuels are certainly compliant with the IMO regulations, there are a number of barriers to widespread adoption by shipping owners and charterers. The primary of these barriers is cost. At the time of writing, biofuels can cost 50 to 150% more than conventional fuel oils. 

However, it is anticipated that as biofuel refining capacity increases, we’ll see a concomitant drop in prices.

One area regarding biofuels where shipowners and operators should proceed with caution is microbial contamination. Without proper preparation, the use of biofuels such as fatty acid methyl ester-based biodiesel can lead to water contamination and microbial blooms.

The importance of bunker fuel oil analysis

With new types of fuels increasingly entering the market, it’s crucial that shipping operators are engaged in thorough and regular fuel testing regimes. 

In fact, in recent months, we’ve seen a spate of incidents whereby bunker fuels have been cut with what appears to be cashew nut oil, resulting in a number of ships subsequently reporting engine damage after burning the fuel in question. 

Guide - for more information about the importance of bunker fuel oil analysis, read our guide here.

Need assistance with bunker fuels? 

Unfortunately, bunker fuels are frequently a source of quality issues - resulting in damage to a vessel’s fuel treatment plant, or even the engine.

If you find yourself embroiled in a bunker-related dispute, then call the experts; Brookes Bell. 

At Brookes Bell, we employ a team of dedicated fuel experts, many of whom have over 30 years’ experience. This team includes marine engineers, tanker Master Mariners, fuel chemists, and laboratory chemists. 
 

Find out how Brookes Bell’s fuel experts can help you now

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