World News
More Slow Steaming Likely After P3 Rejection
Drewry Maritime Research predicts that the failure of the world's three biggest container carriers to form the P3 alliance will push the companies to focus more on other fuel-saving methods, according to excerpts from Drewry's analysis published by industry news site Marine Link.
Drewry said the rejection of P3 by Chinese regulators means the three companies, Maersk Line, Mediterranean Shipping Co., and CMA CGM, will need to reduce fuel consumption in other ways, including slow steaming.
The alliance, which would have allowed the companies to share space on each other's ships, would have eliminated a 9,000 twenty-foot equivalent unit (TEU) vessel per week between Asia and Northern Europe, producing a reduction of about $155 million per year in bunker costs.
However, lengthening transit times of the three companies' nine weekly trips on the loop by seven days would provide the same effect as reducing the total fleet by 15 vessels, while saving about $264 million per year in bunker costs.
While the P3's elimination of service from Asia to Europe would have saved money only for the three carriers, the reduction in costs through slow steaming must be shared with shippers through reduced bunker surcharges.
China's Ministry of Commerce cited issues of restricted competition in preventing P3 from moving forward last month.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 655.50 | 2.00 | 808.50 | 4.50 |
| Rotterdam | 619.00 | 0.00 | 789.00 | 8.00 |
| Houston | 628.50 | 7.50 | 812.50 | 1.50 |
| Fujairah | 653.50 | 4.50 | 900.00 | 2.50 |
| Global 20 Ports Average | 672.00 | 0.50 | 885.00 | 7.00 |
| Global 4 Ports Average | 639.00 | 2.50 | 827.50 | 2.00 |
| Global Average Bunker Price | 727.50 | 1.50 | 933.50 | 5.00 |
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