How is the landscape of fuel quality and claims changing?


Fuel quality has become even more important as the industry adapts to the new 2015 ECA regulations.

Fuel suppliers are now required to provide marine fuel with a sulphur content of just 0.1% for shipping operating in the ECA areas. Even prior to these new regulations suppliers in some regions were struggling to meet previous fuel sulphur levels. High levels of sulphur increase the risk of contamination and when the fines imposed are directed at the ship operators rather than the suppliers – record keeping and fuel quality testing and monitoring becomes essential to tracing where the quality issue has arisen.

So how is the industry coping with changes to the sulphur content? Is it impacting fuel quality?

We asked respondents the following questions:

BUNKER QUALITY

question The quality of bunkers on the vessel has gone down, up, stayed the same?

IBIA reports only
8% of samples found off-spec

bunkering-marine-fuel-loudspeaker What respondents say

From our research it is a mixed picture. 42% say it has stayed the same, 29% gone up and 29% gone down. When we looked to get further clarification through our 1:1 research the picture was similar. Some operators had encountered issues with quality and others not.

According to IBIA Chairman Jens Maul Jorgensen bunker quality is improving. At a recent conference he said that the early results for 2015 showed that there has been a marked improvement in bunker fuel quality with 8% of samples found to be off-spec compared with 10% in 2014. These results are based on samples taken by testing company Intertek ShipCare.

Again what appears to be critical from our research was the length and type of relationship with a supplier. In the case of long term relationships, if there was an issue with quality then that issue tended to be resolved quickly. With new suppliers there did appear to be less trust and so greater potential for quality concerns.

bunkering-marine-fuel-solutionsWhat are the options

Again greater transparency across the industry and the sharing of data on poor performing suppliers could go some way to helping manage future fuel quality issues.

IBIA and the IMO are both working hard with suppliers, ports and operators in order to drive improvements in fuel quality.

CLAIM MONITORING

question Over the past 12 months my company’s claims have gone up, gone down or stayed the same?

42% say claims
have gone up

bunkering-marine-fuel-loudspeaker What respondents say

When you look at claims, which could include claims relating to fuel quality, fuel quantity or demurrage over the last 12 months we find that for 42% of respondents claims rose and for 33% they went down.

So similar to fuel quality issues the picture is mixed.

BUNKER CLAIM RECOVERY

question Generally speaking my bunker claims are recovered?

Only 9% of claims
fully recovered

bunkering-marine-fuel-loudspeaker What respondents say

What was very surprising was the level of success in recovering claims.

From our research: Only 9% of claims relating to bunker quantity are fully recovered. A massive 63% of respondents only get back 50% of the claim and 28% less than 50% of the claim value.

bunkering-marine-fuel-solutions What are the options

In the research we didn’t ask respondents why claims weren’t fully recovered. But from our experience we have found that companies that have deployed a claims management system have in place the tools needed to effectively track and manage claims. By automating the entire claims cycle and recording, tracking, analysing and retrieving quality, quantity and demurrage claims, companies have access to the kind of information needed to back up a claim and so have a greater chance of receiving a full payout.

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