French carrier CMA CGM is apparently the first carrier to abolish its VLSFO surcharge which it imposed in December last year in preparation for the introduction of the IMO2020 sulphur cap on 1 January 2020.
The line posted a statement today to saying that “as from the 1 May 2020, taking into consideration the current price of VLSFO, CMA CGM informs its customers that this Low Sulphur Surcharge is not applicable and may come back later as per our formula”.
Since the beginning of the year the price of VLSFO has fallen far quicker than most commentators expected and today on the MABUX Global Index the price differential between 380HFO and VLSFO was just US$57/tonne.
The price of VLSFO on the global scale is US$297/tonne, however, the cost of a tonne of VLSFO in North Europe was down to US$210/tonne, US$95/tonne cheaper than in North America and US$35/tonne cheaper than in Asia & Oceania, US$135/tonne than the Middle East and Africa regions.
Nevertheless, the slide in the price of crude oil, which fell from around US$65/bbl earlier this year to the low US$20/bbl this week, may have come to an end with the price showing some life, rising around 20% for both Brent Crude and West Texas Intermediate, the benchmark crude prices. At the time of writing, Brent Crude had peaked at US$29.64/bbl and WTI had managed to rally to US$24.82/bbl.
