Bunker fuel prices
Previously in this series, we saw that crude tanker stocks fell in Week 28 (ended July 13), along with VLCC (very large crude carrier) and Suezmax rates. In this part, we’ll see how bunker fuel prices fared last week.
Between July and July 12, bunker fuel’s average price fell to $504 from $505.25 per ton. According to Gibson, bunker fuel prices at Rotterdam fell to $431 from $443 per ton, and bunker fuel prices at the Port of Fujairah dropped to $464 from $465 per ton.
Which companies were affected?
Ships that transport commodities, such as liquefied natural gas carriers, product tankers, dry bulk carriers, and crude oil (DBO) tankers, incur bunker fuel costs. Bunker fuel prices are closely related to oil prices.
Crude tanker companies that operate vessels in the spot market also incur bunker fuel expenses. Of Tsakos Energy Navigation’s (TNP) 65 vessels, only 16 operate in the spot market. Meanwhile, most of Nordic American Tankers’ (NAT) fleet is in the spot market. Of Nordic American Tankers’ 33 vessels, 28 operate in the spot market.
Crude tanker companies record these costs as voyage expenses. In 2017, Euronav’s (EURN) voyage expenses represented 11.5% of its total operating expenses, and Teekay Tankers’ (TNK) voyage expenses represented 18.0% of its total operating expenses.