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Falling Fuel Prices
Impact Total Voyage Costs

With proper information, StormGeo can help advise you on voyage costs and provide strategic route options.

StormGeo Shipping Insights, December 2014
By George Schlinkert, VP of Route Advisory Services

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December 2014 Sorry, but no napping in the weather industry and for those working in the elements.

With significant changes in bunker costs, what was an effective route and speed last month might not be the same this month and might change as well next month.

With proper information, StormGeo can help advise you on voyage costs and provide strategic route options. In the table below, hire costs can be calculated and measured against fuel costs, taking into account the route, weather and the costs associated with the new ECA regulations coming into effect on 01 January 2015.

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Due to weather conditions, there are many articles written about route options during the winter-time in the northern hemisphere, knowing that hurricane-force storms will menace those waters for the next few months.

Down south of the equator, it is summer-time. Fun in the sun! However, it’s also tropical cyclone season. For a ship passing the Cape of Good Hope last Christmas, a present laid waiting for the ship captain in the days ahead. The present was so small, but upon opening it, the captain found the following treat.

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A tropical cyclone moving to the south was expected to intersect the ship’s track by the time the ship passed east of Madagascar. The grey area depicts the War Risk zone for piracy in the Indian Ocean, increasing the distance penalty for trying to pass north of the storm.

Years ago during the days of high hire rates, the decision was easy. Spend the miles and consume the fuel to pass north of the storm in the safe semi-circle. More recently, in the days of low hire rates and high fuel costs, the decision might be to simply wait south of Madagascar and allow the storm to pass before proceeding.

With fuel costs dropping so much in the last few months, the decision is not as straightforward anymore. Certainly, passing south of the storm is not a realistic option, as it places the ship in the dangerous semi-circle of the storm. The winds on the ship’s head will slow her progress so that it is not feasible to transit safely.

However, is it now more economical to stop, slow down or add miles? When strategically planning a route or while enroute, there are several scenarios to consider. StormGeo can help with these decisions to give you the decision support you need while considering total voyage costs.

StormGeo would like to take the opportunity to extend our warmest Season’s Greetings and wish that Peace and Prosperity be pursued globally during 2015.