Bunker Fuel Procurement challenges in Africa

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By: Vikram M Avina -- Senior Research Analyst, Energy and Sustainability

14 March, 2018

Bunker Fuel Procurement challenges in Africa
WHITEPAPER

Introduction

The international marine bunker fuel demand faces many challenges due to the regulations on fuel quality and consumption by the International Maritime Organization (IMO). Transportation is one of the major contributors to the increasing oil demand across the globe. Bunker fuels are the fuels used by international seagoing ships, and this variety of fuels got its name from the containers used to store fuel onboard the ships and in the ports. Bunker fuels are generally used by both the marine and aviation sectors. It is referred to as the marine bunker oil in the marine sector and aviation bunker oil in the aviation sector.

Vessels load fuel at various ports across the globe; fuel is first loaded at the vessel’s source point, and the vessel gets refuelled at several places based on the distance (nautical miles covered). Hence, it is crucial to understand how fuels are attributed to a country or a region of the world. The fuel cost is one of the major cost that vessels incur, of the total cost of running. Even when the oil price is high, sea travel and voyage is considered the most economical way of transporting goods and materials from one region to another. The below Fig. 1 explains the typical vessel running cost 

The International Maritime Transport (IMT) was not covered in the Kyoto Protocol. However, according to The Energy and Resources Institute (TERI), the IMT contributed towards 3.1 percent of the world’s total carbon dioxide (CO2) emissions in 2012. The shipping industry and aviation industry are under pressure to decrease the sulphur oxide (SOx) emissions, and the IMT has come under the scope to reduce CO2 emissions from international maritime sector.   




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