Red Sea diversions send Singapore bunker sales soaring

Source: EIA

As Houthi terrorist targeting of ships continues and vessels avoid Red Sea transits, sales of bunker fuel in Singapore, the world’s largest bunkering fuel port, have increased to all-time highs. This indicates increased global consumption as cargo ships, tankers, and other vessels take longer routes to avoid the Red Sea, reports the U.S. Energy Information Administration.

Many of the new routes involve rounding Africa’s Cape of Good Hope, which can add several thousand miles and two to three weeks of travel time compared with a voyage transiting the Red Sea, depending on origin and destination.

The number of cargo and tanker ships transiting the Suez Canal at the northern end of the Red Sea has decreased by more than half compared with the same time period a year ago, from around 75 vessels transiting to around 35, according to data from the International Monetary Fund’s Portwatch tool.

Recent data on bunker fuel sales from the Maritime and Port Authority of Singapore show bunker fuel sales have increased year over year starting in December of 2023 through the first quarter of 2024, reaching an all-time high in December 2023 based on data that goes back to 1995. More bunkering fuel is sold in Singapore than in any other port.

There is no indication that this will end any time soon. In its most recent customer advisory on the situation, container shipping giant Maersk said that the complexity of the situation in Red Sea has intensified over the last few months. “To safeguard our crew, vessels, and your cargo, we are rerouting around the Cape of Good Hope for the foreseeable future. However, the risk zone has expanded, and attacks are reaching further offshore. This has forced our vessels to lengthen their journey further, resulting in additional time and costs to get your cargo to its destination for the time being.”