Hong Kong is a new market for Propeller. Image Credit: Ship & Bunker

• Following the Shipergy deal, Propeller Fuels sees a sentiment where other smaller firms seek consolidation, and predicts it will close some further deals over the coming years.
• Higher prices mean some small traders struggle to fund volume even with better margins, says CEO Robert Thompson.
• Propeller has cash, a large bank line, and its own trading system as a back office others can plug into.
• Shipergy deal adds Hong Kong as office location and "beefs up" several existing locations with the added traders
• Management and development of Propeller tech to be handed to Shipergy co-founder Daniel Rose under a service agreement.
• Tech spending by Propeller has so far been kept modest and measured: "We're in the grunt phase."

Following its deal to aquire the business of Shipergy, UK-based bunker supplier and trader Propeller Fuels says "it would not be surprised" if it were to close further deals over the next two years, as smaller firms struggle with the cost of staying in the market, CEO Robert Thompson told Ship & Bunker in an interview following the acquisition of the business of Shipergy.

Thompson says high bunker prices are stretching credit lines, and with compliance and credit burdens rising for everyone, the cost of running the engine of a bunker trading business now absorbs a large share of the available margin.

Many smaller companies are now growing weary and short of cash as a result, he says, factors that support a move to more market consolidation.

"Bunker trading is as difficult as its ever been and requires deep pockets and a brave disposition to shoulder the level of risk," he said.

"I think if you're not well resourced and you haven't got plenty of cash and some pretty strong shareholders and all the rest of it, it's tough."

Any further deals would likely be small and niche ones, he says, plugged into Propeller to create more scale.

Why Sellers Are Selling

Thompson puts the pressure on smaller firms down to a poor 2025, marked by difficult trading conditions, and an increase in bad debt, followed by a much better 2026 that many players have been unable to make the most of.

"You come off a bad year, you then go into a good cycle, and a good cycle, unfortunately, has come on the back of a conflict," he said.

"All of a sudden, we can make some money. Our margins are there, but you can only make money if you've got the money to make money in the first place."

With prices roughly doubled, some small and even medium-sized firms are having to give up volume because they lack the cash to fund it, he says.

The cost of simply being in the market has risen with them, and Thompson puts the base overhead cost of running a trading business at $4-7/mt, depending on scale, before any finance costs are considered and profit is made.

"It's not a $2 a ton business anymore," he said.

"It's a $10 a tonne plus business if you want to make money, and that's not accounting for some bad debt that you might get, and you almost certainly will."

The service element of bunker trading is now a small part of the value, he says, while credit assessment, credit granting, and access to finance are arguably the larger part of the value chain.

Suppliers increasingly want to be paid in seven to 14 days, he said, while owners pay in 30 days or later, and financing that 15-20-day gap now costs about $3/mt at current prices.

Sanctions checks, compliance and credit assessment and management add headcount too as the burden and risk increase with the present global geopolitics background.

Thompson noted that when at Tramp Oil, sold to World Fuel in 2004, one credit manager largely covered a business that peaked at 6 million mt, he recalls, while Propeller, at about 15% of that size, employs three plus an analyst.

Many are also tired of the work that goes with running a modern bunker company, he said, including back office, compliance, insurance, collecting debts, and recruitment.

"Most of these companies are run by successful traders, and many struggle with the realities of the rest of the business management," he said.

Propeller, in contrast, has cash, a bank line Thompson describes as "far bigger than we need it to be presently", and a trading and credit system it decided to build for itself within its first six months of operations.

A decision, he said, in retrospect was hard to justify at the time, "but the best one we made."

"Now we have both the cash and the engine in terms of our systems to be able to just plug other companies in, let them benefit from the back office engine we built," he added, pointing to the model it has used with Proteus this year.

The Shipergy Deal

Thompson says the transaction was an asset purchase covering the names, the book, and the people, with Shipergy's traders in Greece, UK and Singapore joining Propeller's existing teams there.

The one new market is Hong Kong, where Shipergy previously had a single trader.

"It's not a market we looked at, but we realise it's a big market, so we've now got a human on the ground and we will have a look at how we best develop it," he said.

A large part of the draw, he says, was technology, and he says Shipergy co-founder Daniel Rose will go on to run and develop technology under separate ownership.

At the same time, Propeller has transferred its own tech products to be managed and developed in the same way under a new service agreement.

"We feel it has a better future under management which 'gets it' and has the expertise, experience and contacts to give it the best chance of success," he said.

The Tech Bet

Thompson said he sees technology and innovation as something that could help lift Propeller beyond its current size, in the way that broker-trading houses grew by offering credit when bunker prices rose.

"Becoming the next large, market leading, trader will be difficult without a trick or innovation of some kind, and we identified tech as that thing," he said.

Propeller now works with three tech products: two it developed in-house, Bridge, Bunker Bridge, and a third that came with the Shipergy acquisition, Energy Beacon.

The first "Bridge" is the trading and credit operating system Propeller built for itself, which Thompson says he is not inclined to sell to others because he feels it gives Propeller an edge.

The second "Bunker Bridge" is an app and desktop-based platform launched at IE Week in 2024 for buying bunkers, and more recently EU Allowances.

"The bunker side needs to have more compelling components to be attractive, so further development is planned, but the ETS / EUA side is making very good progress with close to a hundred and fifty existing registered users," he said.

The third and most recent product is Energy Beacon, an AI-powered platform that analyses global fuel-quality data to provide port-by-port insights on the varying predicted energy content of bunker fuel.

Thompson says they will build that energy-value data into Propeller's own offers, so that prices from different suppliers in a port are corrected for energy content before the deal is done.

While there are plans to develop further tech products, he says that is the easy part.

"We can all build products, and that's actually the smaller part of the problem and the smaller part of the value in the tech side in shipping. It's about adoption and execution," he said.

That road to adoption has been a long one for the industry and uptake of technology products within bunkering has been infamously slow.

While Thompson believes that is starting to change, he also says there is some way yet to go.

"It's not one, two years away. It might be five, 10 years away, but it's going to come," he said.

What will force it, in his view, is the complexity now wrapped around every stem, with alternative fuels bringing ISCC audits, due diligence, and paperwork of their own.

Thompson says a contact buying fuel for specialist vessels told him that each purchase had to be coordinated with 11 or 12 different parties: the supplier, the EU Allowances and FuelEU Maritime side, the ship's charterer, and the freight customers, who needed the fuel data for their own green credentials.

"You need to be able to go, I've done that deal, and everything else is generated, whether that be an EBDN, whether that be telling you that you need this many EUAs, whether that be logging this or that for compliance etc.," he said.

"Otherwise, your life's a misery of having to send emails and log on to multiple disjointed systems."

The word for that, which he says he had not read until two years ago and has heard 20 times since, is interoperability: the planning tool, the FuelEU tool, the ETS tool, and the bunker tool being connected in the background, so that one entry does the work of all of them.

"You've got loads of different companies out there developing a planning tool, a FuelEU tool, an ETS tool, a bunker tool, but none of them are talking to each other as far as I am aware," he said.

"But it will likely come and collaborations are starting to appear. I see this gathering pace."

Thompson says the head of research at a major bank on a call with the MFA about digital business solutions, described commodities and shipping as by far the slowest movers on technology for such a high-value industry, but told them the bank has modelled 2030 as the inflection point, when those systems start talking to each other and adoption moves into exponential growth.

"They said we know you've had false starts on technology and shipping, but this is happening. This is not a false dawn," he said.

Until then Propeller is keeping the spending in check, with Thompson describing its tech investment so far as "well considered and relatively modest."

"We're in the grunt phase where we're building," he said.