We Have to Change Everything in the Bunker Industry and We Have to Do It Very Fast: Muhtaroglu

by Ship & Bunker News Team
Wednesday August 16, 2017

As it begins a period of significant evolution, "everything needs to change" in the bunker industry, Mustafa Muhtaroglu, founder and CEO of Turkish physical supplier Energy Petrol, has told Ship & Bunker.

"Regulations have been changed dramatically. Shipping has changed a lot. The products we use are changing. The supply chain will be changing soon. Bunker trading has been seriously changing, and bunker broking is also very much changed. Buying manners are changing everyday. Finance and credit issues are changing rapidly, and suppliers are changing as well," he said.

"During all these changes we cannot do things the same as we have been doing so far; we have to change everything and we have to do it very fast."

Muhtaroglu says the change should start with a better understanding from all stakeholders of the role bunker suppliers play in the supply chain.

"We are not simply entities giving them fuel. There is very heavy work and investments behind each supplier. Suppliers have to talk to more people face-to-face, we have to update them very frequently as that service we are giving is very critical and getting much more important in the near future. We have to explain to everybody that bunkering is not commodity trading but a service business needing intensive knowledge, a serious level of investment, quality human resources, and closer relations," he said.

As most in the industry now appreciate, significant change will be brought about in 2020 when the global sulfur cap for bunkers lowers to 0.50% and with it an expected shift in Shipper's marine fuel of choice away from HFO to distillate.

While he appreciates the tough market conditions for everyone in the supply chain, Muhtaroglu says the planning, or lack thereof, for this momentous event is symptomatic of the wider industry problems that need to be addressed.

"If you look at today's market, 99% of the industry is only fighting for a few dollars without thinking of the very near future and also without caring about principals, values, and ethics. They are not thinking about the changes we are facing and have no plans how to manage them; everybody is in a 'wait and see' mood," he said.

"Just think how many of us have visited refiners recently to talk about what their plans are for 2020? It would seem very, very few have. How many of us have done something about a code of conduct and ethics in last 6-12 months? Again I would say very, very few. We have been living without any vision for quite some time; we are not talking to each other, we are not listening to each other, and we are not trying to understand each other. This must be changed."

Muhtaroglu, who is also a board member of the International Bunker Industry Association (IBIA) and in addition currently serves as chairman of IBIA's Commercial Working Group, says this message of change also forms a key part of his candidacy for Vice Chairman and Chairman of IBIA for the coming terms.

"IBIA is a very important body, it's an umbrella for the bunker industry. However, we have to have a much more active and creative IBIA. Currently, the vast majority of members are very inactive and are not in close cooperation with IBIA - they only join the IBIA Dinner once a year," he says.

"We have to change IBIA. We have to attract all industry players and leaders to work for IBIA to shape the future of the industry under IBIA's roof. If we don't put our power and knowledge together we will loose our reputation and will not be able to shape the future."

To that end, Muhtaroglu says he has already put a proposal to IBIA to address such issues that includes an intensive action plan of visiting and talking face-to-face with a large number of stakeholders including: ship-owning associations; refineries; bunker suppliers; traders brokers; bunker buyers; owners; managers; charterers; port authorities; service providers; lawyers; media; scrubber producers; LNG companies.

"We have to do this action plan now. We have to involve quality and knowledgeable people; leading names, from leading players, from all industry stakeholders, all for a better and more active IBIA and bunker industry," said Muhtaroglu.

"I am willing to lead this changing period to serve the whole bunker industry on an honorary basis - that is, without any cost for IBIA - and work for better markets, increased transparency, a greater level of listening, and a better understanding of each other. My action plan also aims to create a platform where all related parties can contribute with much closer communications between all parties active in bunker industry."