Rising Fuel Prices, Ocean Freight & UK Transport

Low-sulphur bunker prices have increased dramatically this month – soaring by a third since the end of February – which is likely to impact ocean freight significantly over the coming weeks.

Experts are now predicting that as sanctions escalate, and following the Russian oil ban by the US and UK, prices could hit a record high of $200 a barrel by the end March.

The continuing rises in bunker will have more impact on the longer transit routes, which naturally includes Asia/Europe round trips.

We are not seeing this immediately in Asia ocean freight pricing, which may be due to a dip in demand that was leading towards rates softening. It remains to be seen how the increase in fuel balances against the supply and demand movement towards lower rates.

For now, beware of rate offers that may not be substantiated in the coming weeks. You know – the guys who disappear when space is tight and then crawl out of the woodwork with forward offers when they think the market is softening.

UK Transport

The UK transport market has clearly been impacted by soaring fuel costs and we are receiving many notices of upcoming fuel surcharges, which look to be between 15 and 20%.

Please be aware these increases are incoming very soon and will apply to UK transport of all types and door delivery pricing.

In the meantime, our trade teams are monitoring the ocean freight situation closely, particularly with regard to the Asian market, and will update accordingly.