In-brief analysis
November 3, 2025
Data source: U.S. Energy Information Administration, Maritime and Port Authority of Singapore (MPA), Bunker Sales
Note: 2025 data are an estimate based on data through September. Distillate fuel oil includes marine gasoil (MGO), marine diesel (MDO), and low-sulfur marine gasoil (LSMGO). Heavy fuel oil includes marine fuel oil (MFO).
When the International Maritime Organization’s lower marine sulfur limit known as IMO 2020 took effect in January 2020, commercial shippers pivoted sharply to fueling their vessels with low-sulfur fuel oil (LSFO). In the years since, high-sulfur fuel oil has reclaimed some market share, as a growing number of commercial vessels install sulfur scrubbers that allow operators to use the heavier, cheaper fuel oils while complying with the new sulfur emission limits.
Bunker fuel refers to any fuel supplied to ships to power their engines. New restrictions on bunker fuel emissions instituted as part of IMO 2020 required ocean-going vessels to reduce the sulfur content in marine fuels from 3.5% to 0.5% by weight. Alternatively, vessel operators could install sulfur scrubbers in their ships to reduce emissions while continuing to use high-sulfur fuels.
Prior to IMO 2020, heavy fuel oil was the dominant bunker fuel. After IMO 2020 went into effect, the fastest way for many vessels to comply was by adopting fuels such as LSFO or blending some distillate fuel oil (such as diesel fuel) into a vessel’s bunker fuel supply.
Early adoption of LSFO ahead of IMO 2020 lifted the total volume of LSFO sales in Singapore—the world’s largest bunkering port and a bellwether for the global bunker fuel market—from under 1% of total sales in 2018 to almost 11% in 2019. When the new specifications went into effect in 2020, LSFO sales surged to account for 63% of total bunker fuel sales in Singapore during that year.
Distillate fuel oil sales also increased, although by a much smaller margin, from 8% of total bunker fuel sales in 2019 to 9% in 2020. After peaking in 2020, distillate bunker fuel sales have generally remained between 6% and 8% of fuel sales.
LSFO incurs higher fuel costs for vessel operators. LSFO is priced at a premium to fuel oils with a higher sulfur content, reflecting the costs of desulfurization during the refining process. In response to these higher fuel costs, many vessel operators began installing sulfur scrubbers on existing and new ships, allowing them to comply with the IMO standard while consuming higher-sulfur grades of fuel oil.
The gradual adoption of sulfur scrubbers in the global vessel fleet is reflected in the transformation of consumption patterns in Singapore since 2020. Total bunker fuel sales have generally increased since 2022, yet sales of LSFO specifically have decreased every year after peaking in 2020. Although LSFO remains the most popular bunker fuel in Singapore, heavier sulfur grades have reclaimed some of the bunker fuel market, accounting for 36% of total sales this year, as more ships gain the ability to process heavier fuel oil grades.
Principal contributor: Kevin Hack
