By Roslan Khasawneh and Keith Wallis

SINGAPORE, Dec 9 (Reuters) – Ship gas costs have plummeted to lows not seen in over a decade, pulled down by a rout in crude oil costs because of a world glut simply as demand for marine gas slows on the again of Asia’s weakening economies.

The benchmark end-user worth for marine fuels, often known as bunker, Singapore’s 380-centistoke grade bunker gas , closed at $183.21 per metric tonne on Tuesday, nearly $10 decrease from the day before today and at ranges final seen in January 2005.

Singapore is the world’s important delivery gas hub, buying and selling over 40 p.c of it globally.

The fall in bunker gas follows the tumble in crude costs after the Organization of Petroleum Exporting Countries ended their assembly final week with out even mentioning manufacturing targets, indicating that members will proceed to pump close to document ranges. OPEC members now appear to be defending market share towards each other internally and towards rivals like Russia and North America.

The common every day gas value to function a Very Large Crude Carrier (VLCC) has fallen from over $75,000 to below $18,000 at the moment, which means a pointy discount in working prices for shippers.

Despite this fall in prices, bunker merchants mentioned that demand from shippers remained weak as they wrestle with a slowdown in international seaborne commerce.

“Although (bunker) prices are low, demand has been weak compared with the same time last year because of mounting pressures on the shipping industry amid slowing global activity,” one bunker gas dealer mentioned.

China, the world’s greatest exporter, reported a 6.8 p.c drop in exports in November from a 12 months earlier, whereas its imports slowed 8.7 p.c, because the nation’s economic system grows at its slowest tempo in a long time.

Another dealer mentioned that demand would solely improve if the typical distance of ships’ voyages rose and if ship house owners stuffed their tanks in anticipation of a worth rise. Yet, with the oil provide glut anticipated to final properly into subsequent 12 months and the financial outlook additionally not bettering, that is seen as unlikely.

(Additional reporting by Jessica Jaganathan; Editing by Henning Gloystein and Christian Schmollinger)

(c) Copyright Thomson Reuters 2015.

Monthly Insights from the Helm

Dive right into a sea of data with our meticulously curated weekly “Dispatch” e-mail. It’s greater than only a publication; it’s your private maritime briefing.

Sign Up