Fuel Oil Shipping Guide

Fuel oil moves in MR and LR1 product tankers for regional trades, Aframax and Suezmax vessels for long haul cargoes, and small coastal tankers and barges for hub distribution.

Residual cargoes require heating coils and hull-suitable tanks. Vessel vetting, prior cargo history and tank cleaning cost all affect which ships can compete for a stem.

The time charter equivalent of a voyage is freight revenue less bunkers, port costs and canal dues, divided by voyage days. Bunker price is therefore both cargo and cost.

Waiting time, demurrage exposure and ballast legs frequently determine whether a long-haul arbitrage cargo clears.

Voyage charters price a specific cargo movement, usually against Worldscale. Time charters hire the vessel for a period. Contracts of affreightment cover repeated shipments over time.

Charter parties allocate laytime, demurrage, heating obligations, cargo retention and off-spec liability. Clean documentation matters because cargo quality claims in this trade are common.

Watch fleet growth and scrapping, tonne-mile shifts from rerouted trade, sanctions and vetting constraints on available tonnage, and refinery closures that turn a producing region into an importing one.