Bunker Contamination disabled 600 ships creating $5bn supply chain losses last year

Houston green-tech company FuelTrust has released a new report examining bunker discrepancies in the maritime industry, which includes examples of unethical practices and fraudulent activities related to bunkering.

FuelTrust claims that in the past year over 600 vessels were disabled through fuel problems, despite the fuel being ‘on-spec’, resulting in estimated global supply chain losses exceeding $5 billion. Both fuel suppliers and shipowners incurred financial losses, which are difficult to detect and make claims against.

In its most recent analysis FuelTrust, using Al-based technology, found that between 2021 and 2022, more than 39% of global bunkers exhibited a fuel content delta of 2% or more compared to the amounts stated in their delivery paperwork.

The primary issue identified was the introduction of water into the fuels during the journey from onshore storage tanks to the ship’s bunker tank. This problem typically involved an increase from 0.1% to above 0.25% water content, which, although below the regulated threshold, still resulted in average losses of $14,910 per affected delivery.

Bunker fuels account for more than 50% of a vessel’s operational expenses, meaning fraudulent practices and inadequate supply chain management can significantly affect the profitability of vessel owners and charterers, and fuel suppliers.

In its analysis FuelTrust reveals that just this month, eleven ships lost propulsion, and over 100 ships were affected in a single incident of fuel contamination in Houston.

Even fuel considered “on-spec” (meeting specified quality standards) experiences volume or content issues, leading to financial losses or engine problems.

Jonathan Arneault, CEO and co-founder of FuelTrust highlighted the fact that “This new research across the global bunkering market emphasizes the need for better transparency. By providing visibility, traceability, and security throughout the fuel supply chain, FuelTrust is improving operational efficiency, helping reduce environmental impact, and fostering trust among all stakeholders.”

“As the latest contamination case demonstrates, it’s essential that ship owners, bunker suppliers and charterers can gain better insight into their fuel supply chains. Better information on the fuel we use is also a foundational block of any serious GHG reduction strategy.”