Villa Vie Residences has suspended cruise operations in Cambodia as rising fuel costs put pressure on its business, prompting the company to explore restructuring and recapitalisation options.
The US-based company operates long-term residential cruises aboard Villa Vie Odyssey, allowing passengers to live on the ship while travelling to destinations around the world.
Villa Vie said in a press release on Tuesday that monthly fuel expenses per cabin, which historically averaged around $1,800, had recently climbed to between $6,000 and $8,000 in parts of Asia.
"The company cannot simply pass increases of that scale on to residents, and the resulting shortfall has placed its current operating model under unsustainable financial pressure," it said in a statement.
The company said it had taken steps to reduce fuel consumption since the conflict began in late February, including "slowing the itinerary and spending more time in port".
However, it added that "those measures have not been enough to offset the extraordinary increase in fuel costs".
"We have been unable to continue carrying the resulting operating losses. Passing the full increase on to residents is not a realistic solution," the company said.
Villa Vie is working with residents to arrange disembarkation and temporary accommodation.
"Our focus now is on supporting residents, crew, and employees while we work toward restructuring and recapitalisation over the next 60 days," it said.
The company added that the process was ongoing and "no outcome is assured". No financing or transaction has been finalised.
Bunker fuel costs have risen since the US and Israel attacked Iran in late February. Ship & Bunker's G20-VLSFO Index of average prices across 20 leading bunkering ports has risen by 75% since late February.
