Lower bunker prices are providing scant relief for shipowners facing free-fall in some of the major markets. Analysts believe fuel prices may well fall further in the wake of lower crude oil prices, which sank below $90 on Monday, with Brent closing at $84. Heavy fuel in Singapore finished today at $516 a tonne, down $114.50 on a month ago and $61 on the price last Tuesday. In Rotterdam too prices continued to fall, with heavy fuel closing at $479 a tonne on Monday, down $92 on the month and $57 on prices prevailing one week ago.
Crude oil prices are falling against a backdrop of widening global alarm at continuing financial turmoil and its implications for consumer sentiment. Other commodity prices were easing too, including metal and some basic foodstuffs such as sugar and grain. The speed with which crude oil prices have fallen – it is only three months since prices soared close to $150 a barrel – reflects extraordinary market volatility, with some commentators suggesting that the sharply lower prices suggest that there is little confidence in the efficacy of banking rescue packages hastily put together by governments on both sides of the Atlantic.
For shipping the implications are clear. Weakening consumer sentiment in the US and Europe will inevitably affect economic activity in the giant manufacturing economies of Asia. Import demand there will weaken, affecting the dry bulk market, and manufactured exports will slacken, hitting the key liner routes out of Asia to Europe and across the Pacific to the US.
Crude oil prices are falling against a backdrop of widening global alarm at continuing financial turmoil and its implications for consumer sentiment. Other commodity prices were easing too, including metal and some basic foodstuffs such as sugar and grain. The speed with which crude oil prices have fallen – it is only three months since prices soared close to $150 a barrel – reflects extraordinary market volatility, with some commentators suggesting that the sharply lower prices suggest that there is little confidence in the efficacy of banking rescue packages hastily put together by governments on both sides of the Atlantic.
For shipping the implications are clear. Weakening consumer sentiment in the US and Europe will inevitably affect economic activity in the giant manufacturing economies of Asia. Import demand there will weaken, affecting the dry bulk market, and manufactured exports will slacken, hitting the key liner routes out of Asia to Europe and across the Pacific to the US.