OOCL to Launch Bunker Recovery Surcharge as Its Switches to Low Sulphur Fuel
- Business & Finance
Hong Kong-based Orient Overseas Container Line (OOCL) plans to meet the new sulphur cap regulations by switching to 0.5 percent low sulphur fuel.
The transition to LSF of the company’s entire fleet will start in the second half of 2019, the company said.
As a result, the container carrier expects its fuel bill to jump by over USD 0.5 billion, which the company plans to transfer to customers. Namely, OOCL is following in the footsteps of its fellow liners Maersk, MSC and Hapag-Lloyd in introducing a bunker recovery mechanism.
“Under the current industry environment and the level of cost involved to an industry that is already very cost-sensitive for survival, shippers and the consumers will need to prepare to shoulder this burden,” the company said.
As explained, the mechanism will take various factors into account, including the different fuel types being used, fuel price fluctuations, ship size and capacity, and vessel utilization levels.
“In sum, we believe that we are taking the right step towards a greener and more transparent direction forward in the industry as we all embrace the IMO 2020 Regulation together,” the company concluded.