Viking Line Sees "Favourable Effect on Earnings" from Low Bunker Prices

by Ship & Bunker News Team
Tuesday February 24, 2015

Finnish ferry operator Viking Line last week said that the recent fall in bunker prices are currently having "a favourable effect" on its earnings, but warned that "future bunker price developments represent a significant uncertainty factor."

In its year-end report for January to December 2014, the group reported that its bunker costs for the period decreased by €5.1 million ($5.8 million), equivalent to 8.1 percent of the previous year's spend.

"The decrease is explained by lower average bunker prices and the Group's continued efforts to optimize the bunker consumption of its vessels."

Viking Line nonetheless sounded a note of caution in terms of the outlook for 2015.

"Fluctuations in bunker (vessel fuel) prices have a direct impact on the Group's earnings," it said.

"The European Union's new sulphur directive entered into force on January 1, 2015 and will lead to higher expenses for the Group."

Viking Line also noted that the new rules have affected all but one of its ferries, Viking Grace, which already ran on Liquefied Natural Gas (LNG) meaning it was already compliant with the 2015 Emissions Control Area (ECA) sulfur cap for marine fuel of 0.10 percent.

The group also announced it had seen record passenger numbers in 2014 even though operating revenue fell as a result of a tough competitive landscape.

In September, the Baltic Ports Organization (BPO) said it had identified more than 10 ports which could see development of LNG bunkering infrastructure which it hoped would increase access to the fuel for early adopters such as Viking Line.