POMEME premium over UCOME widens to $80/mt

Netherlands expected to disincentivise UCO for bunkering

Dutch rebates for B100 drops by $31/mt

Rotterdam

Prima Markets has assessed its ARA POMEME barge benchmark up by $100/mt over the past week. POMEME’s premium over ARA UCOME barges has widened to $80/mt, said Prima analyst Ulrich Arnheiter to ENGINE.

Some market sources have told ENGINE that Dutch authorities could count used cooking oil (UCO) as a fossil fuel-equivalent in the EU’s amended Renewable Energy Directive (RED III).

UCO methyl ester (UCOME) currently has a default well-to-tank greenhouse gas (GHG) intensity of 14.9 grams of CO2-equivalent per megajoule (gCO2e/MJ) in RED II. The Netherlands is expected to raise its GHG intensity to the 94 gCO2e/MJ fossil fuel comparator in RED III, which would make its emission profile worse than fuel oils and gasoils on paper.

“… and without crop-based biofuels being a real option, POME-ME becomes the next best thing and next most available thing, which might be why the premium has risen of late,” Arnheiter added.

But Rotterdam’s HBE-rebated B30 blends have defied this sharp increase.

Instead, its B30-VLSFO price has inched lower by $3/mt, tracking an $8/mt decline in ENGINE’s pure VLSFO benchmark. A $9/mt drop in Prima's assessed HBE rebate for B30s has added some support to the price.

Rotterdam's B30-LSMGO price has declined by a larger $17/mt, even as ENGINE's pure LSMGO benchmark has risen by $5/mt in the past week.

The Prima-assessed Dutch HBE rebate for marine B100 has dropped by $31/mt over the past week, which can add upward pressure to B100 bunker prices in Rotterdam.

Meanwhile, the wider ARA region’s B30-VLSFO UCOME (+$6/mt) and B30-LSMGO UCOME (+$14/mt) prices have to some extent tracked a $35/mt rise in the region’s UCOME barge price.

Singapore

Prima’s UCOME FOB China cargo price has remained unchanged on the week, leaving B30 benchmarks largely influenced by conventional fuel price movements.

Singapore’s B30-VLSFO price has declined by $9/mt over the past week, contrary to a $2/mt uptick in ENGINE’s VLSFO benchmark.

Meanwhile, Singapore's B30-LSMGO price has increased by $4/mt, almost in line with a $6/mt increase in pure LSMGO.

The freight rate for UCOME from China to Singapore has edged lower by $0.25/mt to $16.25/mt.

Other bio-bunker news

The European Commission aims to roll out at least €2.9 billion ($3.4 billion) in subsidies by 2027 to accelerate production of biofuels and e-fuels in the EU. The Commission will also work to establish a double-sided auction mechanism for low- and zero-emission bunker fuels at the EU level during the 2028–2034 budget cycle.

By Konica Bhatt

Please get in touch with comments or additional info to news@engine.online