2019年8月30日星期五

IMO 2020 Leads to an Attack on Sulfur in Sour Crude

 
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Oil and Energy Investor with Dr. Kent Moors
Friday, August 30, 2019
IMO 2020 Leads to an Attack on Sulfur in Sour Crude
As the International Maritime Organization 2020 - otherwise known as IMO 2020 - draws near, most analysts expect oil prices to become more volatile.

Now, IMO 2020 will require that shipping vessels reduce sulfur emissions significantly by switching to lower sulfur fuels. Specifically, as of January 1, ships will have to stop using fuel that has more than 0.5% sulfur.

This is a huge change from the current limit of 3.5%.

The impact will initially be felt in the bunker market, the one tracking the fueling of ocean-going vessels.

But the genuine effect will be far more pervasive.

A competition at the refining level is beginning for reduced sulfur product at specific cuts in the distilling process.

The focus here is in the production of low-sulfur content distillates. This puts diesel (and the most direct route to bunker fuel) against heating fuel in competition for the same volume coming out of the same portion of refinery volume.

That means IMO 2020 is having an impact well beyond the shipping sector.

Here's what I mean...

 
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