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The IMO will cut the maximum sulfur content of marine fuel on the open seas from 3.5% to 0.5% starting January 2020. The open-ocean marine fuel market is about 3.9 million b/d.
The EIA says the rule will add uncertainty to crude and product price formation.
Demand for low-sulfur fuel is expected to shift refinery output and raise demand for compliant distillates, which could support diesel prices and affect crude differentials later in the decade.
eia.govDec 14, 2018After 442 past bullish policy events, Crude Oil (Brent) moved a median +1.4% over 5 sessions (60% higher; middle half -2.0% to +4.9%), and +2.1% over 20.
After 90 past bullish policy events, ULSD / Diesel moved a median +1.4% over 5 sessions (66% higher; middle half -1.9% to +4.1%), and +0.1% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
