ALL THE ENDLESS discussions and doubts among ship-owners during the last 2 years suddenly evaporated in front of the pandemic spread of Corona virus. Maybe the discussions will re-emerge one day, but certainly for the moment it’s a no-go.
in Hellenic Shipping News 18/05/2020
https://www.hellenicshippingnews.com/the-future-of-scrubbers/
Scrubber installations have taken a pause, as the effect of the pandemic on oil prices has wreaked havoc in the the market, rendering such a decision, a high risk investment bet, at least for now. In its latest weekly report, shipbroker Gibson said that “in recent weeks, several publicly listed tanker companies announced their decisions to postpone scrubber installations. During the release of their 1st quarter financial results, DHT Holdings said it would postpone installation of five scrubbers, citing strong market conditions as the reason. A similar statement was made by International Seaways. According to Platts, the company has postponed three planned installations to coincide with scheduled dry docking in 2021. Finally, Scorpio Tankers said it will delay the installation of nineteen scrubber retrofits until at least 2021, while Scorpio Bulkers announced its decision to delay the installation of thirteen scrubbers. These developments follow several scrubber cancellations (by independent owners) scheduled to take place in the 4th quarter of last year, with owners instead opting to take advantage of the strong tanker market at the time”..
“However, there has been no mention of a dramatic decline in bunker prices and lower spreads between very low sulphur fuel oil (VLSFO) and high sulphur fuel oil (HSFO) in recent public statements. The Covid-19 driven collapse in oil demand saw the differential between the two bunker fuels fall as low as $50-$60/tonne in March and April, compared to around $275-$300/tonne spread back in January 2020. As a result, the premium in spot earnings for scrubber equipped vessels declined substantially. Using TD3C as a guide, scrubber equipped VLCCs on average earned just $4,000/day more in April than tankers without scrubbers. This is compared to a premium of $16,000/day just a few months ago”, Gibson said.