Guide to Bunker Fuel (2024)

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Bunker Fuel (Marine Gas Oil) Explained – An Easy Guide

The name bunker fuel is thought to come from the storage area within a boat or ship where fuel is stored, known as the fuel bunker. Maritime vessels use bunker fuel to power their motors, but depending on your vessel, it might not be regular white diesel. Some watercraft indeed use diesel and other, larger vessels marine gas oil (which is considered a low sulfur fuel oil or LSFO) as their source of bunker fuel.

Crown Oil is experienced in supplying both and in this bunker fuel guide, our aim is to help you understand the differences between marine fuel types.

However, for the majority of larger commercial ocean-going vessels, they currently rely on HFO or heavy fuel oil to generate power onboard to propel their ships across the ocean, which is the most widely used type of fuel for these vessels. These are considered to be highly polluting and a cause of respiratory diseases and is a component of acid rain that damages vegetation and wildlife.

The new regulations brought in by the International Maritime Organisation (IMO) will ban ships from using fuels with a sulphur content above 0.5%, compared with the current limit of 3.5%. This will ultimately require all waterborne vessels to make the switch from heavy fuel oil (HFO) fuels to marine gas oil (MGO) or risk fines or even vessels being detained, which could affect vital requirements such as insurance cover.

You can read more about this on our sister companies blog – 2020 IMO Regulations – Get Your Ship Ready.

Contents

1. What is bunker fuel?
2. Which bunker fuel is used by ocean-going vessels for the high seas?
3. Which bunker fuel do recreational vessels use?
4. Red diesel for marine use
5. Do I need ultra-low sulphur fuel oil?
6. Marine fuel delivery

What is bunker fuel?

The name itself, ‘bunker fuel’ dates back to steam-powered ships which at the time were powered by coal and stored their ‘fuel’ inside of ‘coal bunkers’ onboard the ship. Now, in place of coal bunkers, ships have fuel tanks, but they’re still often referred to as bunkers.

As so, the name doesn’t refer to the type of fuel the watercraft uses, so the fuel type can be a variety of different fuels depending on the vessel itself. Currently, for larger ocean-going vessels this will generally mean heavy fuel oil, but there are plans to limit its usage and move them towards using marine gas oil in future.

Which bunker fuel is used by ocean-going vessels for the high seas?

Larger ships that travel the high seas generally use heavy fuel oil which is causing a problem for many of the vessels owners with the new regulations coming into play in 2020. This will require all shipowners to make the switch to marine gas oil which is a lower sulfur distillate fuel and meets the criteria of the new regulations.

The current global shipping fleet consumes roughly around 4 million barrels per day of high sulfur fuel oil such a heavy fuel oil, but roughly around 3 million barrels per day of that demand is expected to “disappear overnight” as shipowners make the switch to the lower sulphur fuels, according to the average market forecast calculated by Norway’s SEB Bank.

But that won’t be the end of high sulfur fuel oil’s usage in ocean-going vessels (archived article), as shipowners can install kit called a “scrubber” that strips out sulfur emissions which will allow them to use the current dirtier fuel oil. Some ships already have them installed with many more expected to install them to be able to continue to use the cheaper, lower sulphur fuels. By 2020, it’s suggested that around 2000 ships could have installed scrubbers, according to Wartsila, SEB Bank and industry analyst AlphaTanker. But this is a small fraction of the roughly 90,000 vessels in the global fleet, of which around 60,000 current sail through international routes.

Which bunker fuel do recreational vessels use?

If you own or operate a smaller marine vessel such as recreational boats and yachts – with rear-mounted impeller engines. You’re then eligible to use regular diesel (DERV), the exact same fuel that you will find at the petrol station pumps and in use in car and heavy goods vehicles. However, this is not the only option open to private pleasure craft owners, HMRC regulations actually allow for the use of rebated gas oil which is also known as red diesel. It is also legal to purchase red diesel for propulsion purposes, and we’ll explain the intricacies of that next.

Red diesel for marine use

According to the UK Government, recreational boaters can purchase red diesel for travelling within UK waters, however, they must pay the full rate of tax as they would for regular diesel fuel. Outside the UK’s waters, it will be subject to any prohibitions and restrictions that apply in the waters of the country it’s used in. Boaters will also need to declare to their supplier if they intend to use the fuel to propel a pleasure craft. They must also declare to HMRC the percentage of fuel will be used for propulsion with the below wording:

“I declare that [ ] % of the fuel purchased will be used for propelling a private pleasure craft.

I am aware that the Hydrocarbon Oil Duties Act 1979, which permits the use of marked diesel to propel private pleasure craft, only applies within UK waters. I acknowledge that nothing in that Act, or the making of this declaration, affects any restrictions or prohibitions that may apply to the use of fuel for propelling private pleasure craft outside UK waters, including any restrictions or prohibitions under the law of another Member State that apply within the waters of that Member State.”

Red diesel can be purchased at the reduced rate of duty when it is being used for heating or electricity generation, hence its other name, heating oil. Read our guide to red diesel for more information about this fuel.

Do I need ultra-low sulphur fuel oil?

The International Maritime Organization (IMO) has recently announced a 0.50% global sulphur cap on marine fuel emissions that is due on January 1 2020. Under the new cap, ships must use marine fuels that have sulphur content with no more than 0.50% (ULSFO fuel) to help reduce the amount of sulphur oxide in the air. Alternatively, vessels will need to be retrofitted with filters that bring sulphur emissions in line with regulations when using regular bunker fuel.

Read more about the new IMO regulations in our sister company, Crown Oil Environmental’s blog: 2020 IMO Regulations – Get Your Ship Ready.

Marine fuel delivery

Crown Oil delivers fuels, oils and lubricants across the UK, so, no matter where you are located, if you require a marine gas oil delivery, we are able to supply from 205-litres within 30-miles of our depots, and from 500-litres to 100,000-litres anywhere in the UK. If it’s an emergency we can even ensure your fuel is delivered within 24-hours so you’re not left waiting for your delivery.

Marine fuel polishing

Diesel and water can be a lethal combination for engines and machinery alike, and that’s why it’s essential to have your fuel checked at least once a year. For diesel that is contaminated, Crown Oil offers a fuel uplift service and a fuel polishing service, allowing you to have high-quality bunker fuel at hand with no worries of any damage being caused by bad fuel.

If you still have further questions about our bunker oil (marine gas oil), you can call us today on 0330 123 1444 to speak to our expert bunker fuels team. You can also discuss your requirements with us, request quote and make a purchase using the same number.