BAKU, Azerbaijan, April 6. China and the broader Asia region is expected to be the bright spot, allowing global demand for marine fuels to grow by 1.2% y-o-y in 2023 despite weakening economic growth elsewhere, Trend reports with reference to Fitch Solutions.
“We currently forecast global real GDP rate to decline from 3.1% in 2022 to 2.1%. All regions except for Asia are set to see decelerating growth in economic activity with Central & Eastern Europe expected to see an outright contraction of 0.6% y-o-y. Asia’s real GDP growth rate is set to grow from 3.4% y-o-y in 2022 to 4.2% y-o-y in 2023, mainly driven by Mainland China, which is estimated to see the real GDP growth rate at 5.0%, up from 3.0% in 2022,” reads the report released by Fitch Solutions.
Hence, the company expects the recovery in bunker fuel demand to remain patchy, with varying performance across regions.
“Overall, the impacts of economic recovery in Asia, and in particular in China, will outbalance weakening demand in the North America and Europe, allowing for the total marine fuel demand to grow by 1.2% y-o-y in 2023. We expect the broad consumption trends of particular fuels to hold, with weakening demand for high sulphur fuel oil (HSFO), marine gas oil (MGO) remaining rather stable and low-sulphur fuel oil (LSFO) growing,” reads the report.
LSFO’s dominance on the global bunker fuel market is likely to be long-lasting, in particular in Asia, following a rapid uptake since IMO 2020, according to Fitch Solutions.
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