Ocean carriers are set to reap a whirlwind of financial benefits from cheap oil & gas prices in 2015 if prices continue to trend at the current five-year low prices, but shippers are going to be the real winners.

A 20,000-TEU ship operating 80-day round voyages on the Asia-North Europe route would save over $6 million on fuel costs compared to the 2014 prices if the ultra low bunker prices persist through 2015.

10,000-13,000-TEU vessels — the average sizes currently deployed in trading lanes around the world could have an estimated saving ability of more than $4 million on the Asia-North Europe route.

If current bunker prices persist in the long-term, we are looking at tens of millions of dollars $ saved in fuel costs. According to Container Insight, a single 12,000-19,000 TEU vessel would save more than $70 million at current bunker princes, throughout the vessels service life.

Lower bunker prices will make larger container vessels not as competitive if the smaller vessels are utilizing 100% of their available space for containers, which is always something carriers hope for, but assuming a 100% load at all times is not feasible.

We predict an 18,000-TEU Vessel will see bunker prices drop by $65 to $125 TEU. Estimates for a 12,000-TEU Vessel see bunker prices dropping $80 to $156 per TEU.

Assuming a vessel makes 5 roundtrip voyages a year, with an average speed of 17-18 knots, we are looking at a price of around $365 per ton of bunker fuel, and $680 for Marine use Gas Oil, at this time these are just estimates, with the rapidly changing energy market, prices could swing up or down by a wide margin. These estimates also do not include additional expenses for low sulfur fuel limits that kick in 01/01/2015.

If these low energy prices continue for years to come, we will see increased spending from consumers and corporations, which in turn will boost container demand & profits for Ocean Carriers.

In theory, High demand should mean better ship utilization, which will lead to carriers negotiating deals for on average lower bunker costs. Carriers in every aspect of the business stand to see record profits from continued lower bunker and marine gas costs.

Questions / Comments? Contact: Mark@cmaritime.com.cn