Bunkers
Meaning
Bunkers are a ship's fuel, mainly very low sulphur fuel oil (VLSFO), high sulphur fuel oil (HSFO) for scrubber-fitted ships, and marine gasoil (MGO).
Also written as Bunker fuel, Marine fuel, VLSFO, HSFO, MGO
Bunkers explained
Bunkers are the biggest variable cost in a tanker voyage. Since 2020 most ships burn VLSFO at sea, with MGO in emission control areas, while scrubber-fitted ships can keep burning cheaper HSFO.
On a voyage charter the owner buys the bunkers; on a time charter the charterer does, and the ship's bunkers on delivery and redelivery are settled at agreed prices.
Related terms
TCE
TCE (time charter equivalent) converts a voyage's freight into daily earnings: freight minus voyage costs, divided by the days the voyage takes.
ECA
An emission control area (ECA) is a sea area where ships must burn fuel with no more than 0.10% sulphur, or use a scrubber, under MARPOL Annex VI.
Scrubber
A scrubber (exhaust gas cleaning system) removes sulphur from a ship's exhaust, letting it burn cheaper high sulphur fuel oil while staying compliant.
Speed and consumption warranty
A speed and consumption warranty is the owner's promise on a time charter that the ship can steam at a stated speed on a stated daily fuel consumption.