Oil prices are highly volatile, but Drewry tracking of average marine bunker prices by quarter for Very Low Sulphur Fuel Oil shows a downwards trend which has now lasted for nearly three years.
Bunker price and bunker surcharge trends
Source: Drewry LSFO Bunker Tracker, BAF and bunker policy support services
Taking the Asia-Mediterranean route as an example, typical “Bunker Adjustment Factors” (BAF) had surged in 2022, as Russia commenced its attempted invasion of Ukraine, but have since been mainly falling for nine quarters.
For shippers, current best practice is to have a standard BAF policy, under which the BAF charges of all providers are indexed on an independent fuel price. Drewry recommends this technique to all medium and large shippers.
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Source: Drewry
