As world shipping braces for a $60 billion hike in the industry-wide fuel bill from 2020, help is on its way in the form of a new toolkit that scours the globe in real-time for the optimal bunker ports.

INATECH
A GLENCORE COMPANY

Inatech, a unit of Glencore that specializes in energy trading risk management systems, has built the ‘Smart Trader’ app to enable companies to map their entire fleet of ships and visualize the best routes given sea and port conditions to achieve the lowest prices for the desired quality of fuel. The toolkit leverages bunker alerts and pricing data from S&P Global Platts, the leading independent provider of information and benchmark prices for the energy and commodities markets. Torm, the tanker company that’s one of the world’s biggest carriers of refined oil products, worked with Inatech on the app’s design and is among the first clients.

The major international shipping companies are investing in technology ahead of the implementation of the International Maritime Organization’s rules to limit sulphur emissions to 0.5% from the current ceiling of 3.5%, which comes into effect from January 2020. S&P Global Platts Analytics estimates that complying with the IMO’s cap will add $60 billion to fuel costs in 2020.

“Improved technology is vital because the new IMO rules will not only increase costs but could also trigger unprecedented volatility in prices as a widening array of choices between the various fuel oil types skews supply and demand dynamics in what is still a relatively opaque market,” said Inatech CEO Jean-Hervé Jenn. “That motivates our push to broaden the available options for bunker buyers, who will suddenly be immersed in an infinitely more complex market in less than a year’s time.”

With an expected jump in bunker fuel price volatility, Smart Trader enables companies to track their vessels on an integrated system that manages fuel levels on board and updates with live prices and news for supply en route. The interactive platform not only displays which ships in the fleet are running low on fuel but whether their fuel type is compatible with availability and optimal pricing in the direction of travel and, if it’s not, what would be the most optimal rerouting. Potential suppliers are checked for quality and credit references to control counterparty risk. The technology moves the bunker buyer from operational to analytical, continually dissecting and analyzing quotes as they’re updated from the full suite of international suppliers.