UK Supplier Looks to Provide Buyers With More Certainty Over Future Bunker Prices

by Ship & Bunker News Team
Wednesday June 17, 2015

UK physical marine gas oil (MGO) supplier Geos Group is looking to help clients form hedging strategies to buffer the possible effects of a rise in oil prices, the company has announced in an emailed statement.

The supplier noted that Spencer Dale, Group Chief Economist at BP, predicts global demand for energy is expected to rise by almost 40 percent over the next two decades largely on the backs of growing demand from third-world countries. 

"By incorporating financial instruments such as swaps, caps, collars, and swap options into their purchasing plans, ship owners and operators can replace an unknown future fuel price with a more certain outcome," said the company.

Geos Group added that it expects shippers to become more concerned with how to protect current business performance once crude prices, and in turn bunker prices, begin rising again.

“Although there is still some risk involved, and possibly an additional cost, a hedging strategy that is carefully structured to suit a client’s needs can offer considerable protection against the financial risks of a highly volatile fuel market," said Commercial Director Adrian Proctor.

Earlier this year, Geos Group also announced a strategic distribution alliance with Phillips 66 to supply vessels across Northern England with MGO. 

Ship & Bunker News Team
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