BunkerEx has launched a live trading screen for physical delivered bunkers that allows shipowners to track millisecond price moves and lock in delivered fuel prices up to six months out.
Since launching in 2018, the company said it has identified two major problems in the industry.
First, oil prices move every second but physical bunker prices are mostly static throughout the day. Until now shipowners have been unable to benefit from sudden intraday dips in the market.
Prices shown on BunkerEx’s new screen are firm, delivered and actually tradeable.
Futures tick data shows oil prices rapidly drop by over $5 per ton several times per day, sometimes only for a few seconds before they recover.
The second problem BunkerEx has noticed in the industry relates to the lack of operational flexibility.
There is often a gap between when ships are fixed and bunkers are stemmed leaving shipping companies who take on cargoes months in advance exposed to rising fuel prices. With oil at 21-year lows BunkerEx has seen enormous demand from shipping companies wanting to take advantage of cheap forward bunkers.
Traditionally, however, buyers hesitate to buy months ahead due to the lack of operational flexibility, but BunkerEx has managed to offer flexible contracts alongside price certainty.
Shipping companies can now buy today for delivery months ahead without a vessel name. Volumes can be rolled forward in case of delays or transferred to any other port worldwide. Quantities can be increased or lifted across multiple vessels in increments as low as 10 tons.