Jitters reverberating through world markets because of the situation in the Ukraine, where Russia is in a tense stand-off with Europe and the US, have had an immediate effect on bunker fuel.
Very low sulphur fuel oil (VLSFO) was measured at $741 per tonne this morning – a 57% year-on-year (y-o-y) increase.
The last time bunker prices trended that high was in 2008 when the world was heading into a global financial crisis.
Back then, the global bunker standard, intermediate fuel oil, rose to $739.25 per tonne.
This time tensions are on a knife-edge as Russian President Vladimir Putin appears hell-bent on invading sovereign territory he has declared to be “not a real country”.
The way things stand at the moment, predictions are that the price of VLSFO is unlikely to dip anytime soon.
With the prices having steadily trended up over the last 12 months because of Covid-related stresses in global shipping, bunker analysts view the war rumblings in Eastern Europe with more than just a measure of trepidation.
Considering that it’s widely anticipated that the price of crude oil will most likely hover around $100 a barrel for the next months, a cooling off period for bunker prices seems to be unlikely – if not completely off the cards.
Long story short, portents point to bunker prices rising even more than their 57% y-o-y spike.
