Freights surge as bunker prices spurt globally

The Russia-Ukraine conflict is having a direct fallout on freight, putting trade participants in a bind. Bunker charges spiralled to dizzying heights as benchmark crude oil spurted to seven-year highs of more than $105/barrel. Oil prices zoomed by more than 30% since the start of the conflict conwhile bunker costs, which comprise 30-35% of shipping operations, are up 16%. Bunkers are the fuels consumed by vessels during operation.

For instance, a coking coal shipment on Panamax from Australia to India consumes around 1,000 tonnes of bunker. Two weeks back, prices of bunkers were at $725/tonne. The same has now escalated to $905/tonne, which means an increase of more than $175/tonne and translates into $175,000 extra on this