SINGAPORE, Sept 28 (Reuters) - Swiss trading house Trafigura has merged its global fuel oil and gasoil trading desks ahead of new shipping fuel regulations starting in 2020 set by the United Nations' shipping agency, three trade sources said.
The merger is "a prudent step to structure ourselves for future market conditions including in preparation for the upcoming IMO 2020 changes amongst others to ensure better integration across the bunkering space," said one of the sources with direct knowledge of the matter.
The source declined to be identified due to their company policy.
From 2020, the International Maritime Organization (IMO) rules will ban ships from using marine fuels, also known as bunkers, with a sulphur content above 0.5 percent, compared with 3.5 percent now, unless they are equipped with so-called scrubbers to clean up sulphur emissions.
Joshua Grizzle heads the new global team, while Seetal Patel has taken a new senior role within the oil and oil products trading division, the source said.
Trafigura's trading desk merger mirrors a similar move by oil-giant BP, which combined its fuel oil and middle distillates desks about four months ago.
"Whatever we do in BP is to anticipate market changes, and to ensure we can run our business in the most efficient way, we can supply our customers, meet demand in the market," Janet Kong, chief executive of Integrated Supply and Trading (IST) Eastern Hemisphere at BP in response to questions about BP's trading desk merger.
The trade sources said similar trading desk mergers at other trading houses and major oil companies could be expected in the run up to the 2020 marine fuel sulphur cap.
The upcoming changes to marine fuel specifications have rocked the global shipping, bunkering, oil refining and storage industries since the 2020 deadline was set almost two years ago.
The global shipping industry burned a total of 3.3 million barrels per day (bpd) of high-sulphur fuel oil (HSFO) in 2017, according to Goldman Sachs.
By 2020, scrubber installations will reduce demand for HSFO to 1 million bpd by 2020 and 1.4 million bpd by 2025, according to the bank.
The remaining gap in global shipping fuel demand from 2020 is expected to be filled by costlier low-sulphur fuels such as marine gasoil or ultra-low-sulphur fuel oil. (Additional reporting by Florence Tan in SINGAPORE; Editing by Christian Schmollinger)