Title
The effect of high fuel costs on liner service configuration in container shipping The effect of high fuel costs on liner service configuration in container shipping
Author
Faculty/Department
Faculty of Applied Economics
Institute for Transport en Maritime Management (ITMMA)
Publication type
article
Publication
London ,
Subject
Economics
Source (journal)
Journal of transport geography. - London
Volume/pages
17(2009) :5 , p. 325-337
ISSN
0966-6923
ISI
000270049300001
Carrier
E
Target language
English (eng)
Full text (Publishers DOI)
Affiliation
University of Antwerp
Abstract
For shipping activities, not least container shipping, bunker fuel is a considerable expense. In the last 5 years, bunker prices have risen considerably. An increasing bunker price in container shipping, especially in the short term, is only partially compensated through surcharges and will therefore affect earnings negatively. This paper deals with the impact of increasing bunker costs on the design of liner services on the EuropeFar East trade. The paper assesses how shipping lines have adapted their liner service schedules (in terms of commercial speed, number of vessels deployed per loop, etc.) to deal with increased bunker costs. The paper also includes a cost model to simulate the impact of bunker cost changes on the operational costs of liner services. The cost model demonstrates for a typical North EuropeEast Asia loop that the current bunker prices have a significant impact on the costs per TEU even when using large post-panamax vessels. The model also shows shipping lines are reacting quite late to higher bunker costs. The reasons that explain the late adaptation of liner services relate to inertia, transit time concerns, increasing costs associated with fixing schedule integrity problems and fleet management issues.
E-info
https://repository.uantwerpen.be/docman/iruaauth/337e85/037c14957a8.pdf
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