World News
Increasing Need for Buyers to Vet Bunker Suppliers, Says Singapore's TransNav Shipping
Vessel owners need to carefully vet bunker suppliers prior to conducting business with them, Morten Olsen Vind, vice president at Singapore-based tanker owner Transnav Ship Management Pte Ltd (TransNav Shipping), has told Maritime CEO.
"One major concern we are having these days, and I do not believe this is only TransNav as it affects the shipowning and managing community worldwide, is the increasing need to very carefully perform due diligence on our bunker suppliers," said Olsen Vind.
One of the major problems, he says, is that poor shipping markets have left a number of suppliers exposed financially.
"Some suppliers are massively exposed due to many market-suffering owners in the bulk, offshore, and the container sectors. In cases where bunker companies default, the result can be a second bill for bunkers to the actual suppliers," explained Olsen Vind.
This "double payment" scenario has been most prominently highlighted following the 2014 collapse of OW Bunker, leaving many buyers unsure of who to pay.
Earlier this month, in the final hearing of the so-called "Res Cogitans" OW Bunker UK test case, the UK Supreme Court unanimously found in favour of OW Bunker / ING Bank, confirming that any such cases that fall within UK jurisdiction can lead to double payment.
This is because the court ruled that ING, as assignee of OW Bunker, should be paid the full invoice amount by the buyer under a contractual debt, while the physical supplier involved in such cases can still claim for the cost of the actual bunkers, meaning the the buyer is exposed to effectively paying twice for the same fuel.
This is not the case in every jurisdiction, however.
Cases currently being heard in the U.S. have so far determined that the physical supplier involved in the OW Bunker cases would not be entitled to payment.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 647.00 | 6.00 | 762.00 | 5.50 |
| Rotterdam | 599.00 | 1.00 | 751.00 | 0.50 |
| Houston | 618.00 | 11.50 | 802.50 | 6.50 |
| Fujairah | 642.00 | 5.50 | 883.50 | 5.50 |
| Global 20 Ports Average | 661.50 | 3.50 | 859.00 | 5.00 |
| Global 4 Ports Average | 629.50 | 1.00 | 799.50 | 1.50 |
| Global Average Bunker Price | 719.00 | 3.50 | 915.00 | 7.50 |
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