Zederkof: After OW, the Trust in the Bunker Industry has Gone

Zederkof says the trust in the bunker industry has gone following the 2014 collapse of former industry giant OW Bunker

The trust in the bunker industry has gone following the 2014 collapse of former industry giant OW Bunker, according to Henrik Zederkof, CEO of Dan-Bunkering.

There are now also concerns over the "durability" of suppliers, he added.

Zederkof's comments came at the recent Platts 7th Annual European Bunker Fuel Conference, and as IBIA's Unni Einemo observed Thursday, others at the event expressed similar concern over the current state of the industry.

One of the biggest issues in the post-OW Bunker era is the matter of who should be paid in the event of a player going bust.

In a typical sales chain where a trader is being used as an intermediary, the buyer pays the trader, and the trader pays the physical suppler less their (typically small) trader margin.

Earlier this year, the UK Supreme Court ruled in the so-called Res Cogitans OW Bunker UK Test Case that OW Bunker's assignee, ING Bank, should still be paid the full bunker bill by the buyer, not for the bunkers themselves, but as a contractual debt; the fact that ING Bank would likely then not pay the physical supplier was not a factor.

This leaves the physical supplier open to claim for the cost of the actual bunkers, and the ship owner facing the prospect of effectively paying twice for the same bunkers.

Speaking at the same event, Jan Christensen, Global Head of Bunker Operations at physical suppliers Bomin Group, said ship owners have responded to this by looking to shorten the supply chain, and are aiming to deal directly with the physical supplier.

Zederkof, however, highlighted that traders are needed in the bunker industry, as they provide much needed credit to the ship owners.

You can read Unni's comments on the matter here: http://ibia.net/after-ow-the-trust-is-gone/