Very Low Sulphur Fuel Oil Market – Global Industry Size, Share, Trends, Opportunity, and Forecast Segmented By Type (Residual Fuel Oil, Distillate Fuel Oil, Utility Ultra-Mobile Devices), By Application (Marine Fuel, Power Generation, Industrial Use), By End-User (Shipping Companies, Power Plants, Industrial Sector), By Region & Competition, 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 60.35 Billion
CAGR (2026-2031)	20.62%
Fastest Growing Segment	Power Plants
Largest Market	Asia Pacific
Market Size (2031)	USD 185.86 Billion

Market Overview

The Global Very Low Sulphur Fuel Oil Market will grow from USD 60.35 Billion in 2025 to USD 185.86 Billion by 2031 at a 20.62% CAGR. Very Low Sulphur Fuel Oil is a specialized marine bunker fuel defined by a maximum sulphur content of 0.50 percent by mass, formulated to meet stringent international environmental compliance standards. The market is primarily driven by the International Maritime Organization’s rigorous emission regulations, which mandate the reduction of airborne pollutants from the shipping industry. Furthermore, the operational cost advantage of this residual fuel blend compared to more expensive marine gas oil distillates, coupled with its established supply infrastructure at major maritime hubs, sustains its preference among global shipowners for main engine operations.

However, the market faces a substantial challenge regarding the rising installation of exhaust gas cleaning systems, which enables vessels to legally utilize less expensive high-sulphur alternatives. This cost disparity creates ongoing competitive pressure on compliant fuel volumes in major ports. According to the Maritime and Port Authority of Singapore, in 2024, sales of very low sulphur fuel oil totaled 29.58 million tonnes. This figure represented a year-on-year decline of approximately 4 percent, illustrating the tangible impact of alternative compliance methods on market demand.

Key Market Drivers

Strict enforcement of the IMO 2020 Global Sulphur Cap Mandates remains the primary catalyst for the market, fundamentally establishing very low sulphur fuel oil as the essential energy source for the majority of the world’s merchant fleet. As regulatory bodies rigorously police the 0.50 percent sulphur limit, shipowners who have not invested in exhaust gas cleaning systems must rely on compliant VLSFO blends to maintain uninterrupted operations. This regulatory imperative ensures a consistent baseline of demand at major refueling hubs, effectively countering the competitive pressure from high-sulphur alternatives used by scrubber-equipped vessels. For instance, according to the Port of Rotterdam Authority, January 2025, in its annual bunker statistics, sales of very low sulphur fuel oil at the port reached 3.08 million tonnes in 2024, retaining a dominant 34 percent share of all fossil fuel sales.

The sustained expansion of international seaborne trade volumes further amplifies market growth, as rising cargo throughput directly correlates with increased fuel consumption across major shipping lanes. As global supply chains recover and restructure, the intensified movement of containerized goods and bulk commodities necessitates higher bunker intake to support longer voyages and frequent port calls. According to the United Nations Conference on Trade and Development (UNCTAD), October 2024, in the 'Review of Maritime Transport 2024', global maritime trade volume grew by 2.4 percent in 2023, signaling a robust recovery that underpins fuel demand. This upward trajectory in shipping activity is evident in critical transit points where compliant fuel uptake remains high to service transoceanic vessels. Highlighting this trend, according to the Panama Maritime Authority, in February 2025, total sales of very low sulphur fuel oil in Panama reached approximately 3.37 million metric tons for the full year of 2024, underscoring the fuel's critical role in facilitating global commerce.

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Key Market Challenges

The primary obstacle hindering the growth of the Global Very Low Sulphur Fuel Oil Market is the increasing deployment of exhaust gas cleaning systems, commonly known as scrubbers. These systems allow vessels to burn high-sulphur fuel oil while capturing sulphur emissions, enabling regulatory compliance without purchasing the more expensive very low sulphur fuel oil. The substantial price differential between high-sulphur options and compliant blends provides a compelling economic incentive for shipowners to invest in scrubber technology, effectively reducing their reliance on the very low sulphur fuel oil market.

This trend directly erodes the demand for compliant fuels in key maritime hubs. As more vessels retrofit with scrubbers to capitalize on operational savings, the volume of very low sulphur fuel oil required diminishes. According to the Port of Rotterdam Authority, in 2024, the share of high sulphur fuel oil within total conventional bunker demand rose to 34 percent, increasing from 31 percent in the previous year. This rise in high-sulphur fuel consumption confirms that alternative compliance methods are actively displacing demand in the very low sulphur fuel oil sector.

Key Market Trends

Accelerated adoption of bio-VLSFO hybrid blends is rapidly emerging as a primary strategy for shipowners to meet Carbon Intensity Indicator (CII) requirements without capital-intensive retrofits. By mixing conventional very low sulphur fuel oil with renewable components like fatty acid methyl esters, operators can significantly reduce lifecycle greenhouse gas emissions while leveraging existing onboard machinery and bunkering infrastructure. This shift towards lower-carbon drop-in fuels is quantifying into substantial market volumes, particularly in regions with incentivized green corridors. According to the Port of Rotterdam Authority, January 2025, sales of bio-blended very low sulphur fuel oil specifically reached 439,227 tonnes in 2024, verifying the material shift towards these sustainable hybrid formulations.

Simultaneously, the integration of digital bunkering and procurement platforms is fundamentally altering operational standards to ensure transaction transparency and efficiency. The deployment of electronic bunker delivery notes (e-BDN) and real-time data monitoring systems addresses long-standing industry challenges related to quantity disputes and documentation fraud, fostering greater trust between suppliers and buyers. This modernization is being driven by regulatory mandates in leading hubs, which are enforcing digital protocols to govern massive fuel transfer volumes. Highlighting the magnitude of this operational overhaul, according to the Maritime and Port Authority of Singapore, January 2025, total bunker sales reached a record 54.92 million tonnes in 2024, a volume that will be fully subject to the port's mandatory digital bunkering framework effective April 2025.

Segmental Insights

The Power Plants segment represents the fastest-growing category in the Global Very Low Sulphur Fuel Oil Market. This expansion is primarily driven by the implementation of stringent environmental regulations regarding sulphur emissions from stationary sources. As nations enforce tighter air quality standards, power generation facilities are shifting away from high-sulphur fuels toward Very Low Sulphur Fuel Oil to ensure compliance. Additionally, the widespread availability of these lower-sulphur blends allows operators to meet sustainability requirements efficiently, serving as a practical alternative for continuous energy production in regions reliant on oil-based power generation.

Regional Insights

Asia Pacific holds a leading position in the Global Very Low Sulphur Fuel Oil Market, driven by extensive maritime trade and shipping volume. The region encompasses major bunkering hubs, notably Singapore and ports across China, which service a vast number of international vessels. This market strength is supported by compliance with International Maritime Organization regulations requiring reduced sulphur emissions in shipping. High manufacturing output in the area necessitates frequent cargo movement, thereby sustaining the demand for compliant marine fuels. These factors collectively establish Asia Pacific as the primary contributor to global market revenue.

Recent Developments

• In September 2025, the Global Centre for Maritime Decarbonisation (GCMD) released the findings of Project LOTUS, a research initiative conducted in partnership with NYK Line. The six-month shipboard trial, which originally commenced in May 2024, evaluated the continuous use of a B24 biofuel blend comprising 24% fatty acid methyl ester and very low sulphur fuel oil (VLSFO). The report confirmed that the long-term use of this blend had no adverse effects on engine performance or fuel delivery systems, providing critical data to support the maritime industry's adoption of biofuel blends for decarbonization.
• In April 2025, Vitol Bunkers launched a new co-processed very low sulphur fuel oil (VLSFO) offering designed to comply with FuelEU Maritime regulations. The company's refinery in Fujairah produced the fuel, which reportedly delivers a significant reduction in greenhouse gas intensity compared to fossil-based alternatives. The first vessel bunkered this new RMG380 grade fuel at the port of Fujairah. The Head of Energy Transition for Shipping at Vitol noted that the product possesses the same chemical composition as conventional fuel, eliminating the need for special contractual clauses or additional operational permissions.
• In February 2025, Petrobras completed its inaugural sale of very low sulphur fuel oil (VLSFO) containing 24% renewable content in Singapore. The transaction involved the supply of a B24 blend to Golden Island, a local licensed bunker supplier. The product consisted of 76% mineral fuel oil derived from the company's refineries and 24% used cooking oil methyl ester (UCOME). The Director of Logistics, Commercialization, and Markets at Petrobras highlighted that this commercialization aligned with the company's strategy to develop low-carbon products and innovatively expand its business value in the Asian bunker market.
• In December 2024, HD Hyundai Oilbank Co. initiated its first deliveries of bio-very low sulphur fuel oil (VLSFO) to Yang Ming Marine Transport in Taiwan. This event marked the first instance of a South Korean firm exporting bio-VLSFO to an international client. The fuel, produced using a base of VLSFO with 0.5% or less sulphur content, was supplied as a blend with biodiesel. The company stated that this product requires no engine modifications and utilizes existing infrastructure, aligning with broader industry efforts to reduce carbon emissions in the global shipping sector through the adoption of cleaner fuel alternatives.

Key Market Players

• Exxon Mobil Corporation
• Shell International B.V
• Chevron Corporation
• TotalEnergies SE
• BP plc
• Marathon Petroleum Corporation
• Valero Energy Corporation
• Hess Corporation
• Eni S.p.A
• ConocoPhillips
• China National Petroleum Corporation
• Petróleo Brasileiro S.A

By Type	By Application	By End-User	By Region
Residual Fuel Oil Distillate Fuel Oil Utility Ultra-Mobile Devices	Marine Fuel Power Generation Industrial Use	Shipping Companies Power Plants Industrial Sector	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Very Low Sulphur Fuel Oil Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Very Low Sulphur Fuel Oil Market, By Type:

• Residual Fuel Oil
• Distillate Fuel Oil
• Utility Ultra-Mobile Devices

• Very Low Sulphur Fuel Oil Market, By Application:

• Marine Fuel
• Power Generation
• Industrial Use

• Very Low Sulphur Fuel Oil Market, By End-User:

• Shipping Companies
• Power Plants
• Industrial Sector

• Very Low Sulphur Fuel Oil Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE