World News
40% More Bunker Fuel Per Journey Because of Red Sea Diversions: Maersk
Container line and logistics firm AP Moller-Maersk has set out some of the widespread impacts of the current situation in the Red Sea and Gulf of Aden on its business.
The company is now using 40% more fuel per journey because of the need for longer voyages to avoid Yemeni waters where possible, it said in a customer advisory on Monday.
Commercial ships operating near Yemen have been coming under attack from the country's Houthi movement over the past six months in a response to the conflict in Gaza. Several leading shipping companies have been avoiding the region altogether, taking longer routes around Africa rather than using the Suez Canal.
"The effects of the situation in the Red Sea are widening and continuing to cause industry-wide disruptions," Maersk said in the note.
"We are developing solutions with the goal of offering our customers greater reliability for their supply chains.
"The complexity of the situation in Red Sea has intensified over the last few months.
"To safeguard our crew, vessels, and your cargo, we are rerouting around the Cape of Good Hope for the foreseeable future.
"However, the risk zone has expanded, and attacks are reaching further offshore.
"This has forced our vessels to lengthen their journey further, resulting in additional time and costs to get your cargo to its destination for the time being.
"You will see relevant surcharges on your latest invoices.
"These are to offset the costs of the longer journeys, increased sailing speed, and additional fuel costs.
"For example, we are currently using 40% more fuel per journey and charter rates are currently three times higher, often fixed for five years."
The company expects an industry-wide capacity loss of 15-20% on the Far East to North Europe and Mediterranean market in the second quarter.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 624.50 | 1.00 | 732.00 | 8.50 |
| Rotterdam | 571.00 | 3.00 | 758.00 | 16.50 |
| Houston | 591.50 | 4.00 | 760.00 | 5.50 |
| Fujairah | 629.00 | 0.50 | 877.50 | 3.00 |
| Global 20 Ports Average | 637.00 | 0.00 | 819.00 | 3.00 |
| Global 4 Ports Average | 604.00 | 0.00 | 782.00 | 5.50 |
| Global Average Bunker Price | 688.00 | 2.50 | 879.00 | 1.00 |
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