Bunker procurement for small fleets: narrowing the price gap

Owners with a handful of ships often pay more for the same fuel than large fleets do, for reasons that have little to do with the fuel itself. This guide explains where the gap comes from and the practical steps that narrow it.

Why small owners often pay more

Suppliers price risk, effort and certainty as well as the fuel. A small owner usually looks worse on each count, even when its ships are well run.

• Volume: occasional, single-vessel stems give a supplier less reason to sharpen its price than a steady programme of deliveries.
• Credit: a supplier extending 30 days' credit to an unfamiliar company will price in the risk, ask for security or require prepayment.
• Information: large buyers see many offers every day and know where the market is. A small buyer comparing three quotes has far less to go on.
• Timing: short-notice enquiries force suppliers to fit a stem around existing barge schedules, and the price reflects it.
• Relationships: suppliers give their best terms to buyers who pay on time, accept deliveries as planned and raise issues professionally.

Credit terms are part of the price

Two offers at the same price per tonne are not equal if one requires payment in advance and the other gives 30 days. Standard contracts reflect this: under the BIMCO Bunker Terms 2018, payment is due within 30 days unless the confirmation note says otherwise, late payment carries interest, and the seller may demand immediate payment if the buyer's creditworthiness deteriorates.

To improve credit terms, provide suppliers with clear company and ownership information, pay consistently on time, and avoid deducting disputed amounts from invoices unilaterally. A clean payment record is one of the few advantages a small owner can build quickly.

Pooling volume

The most direct way to improve terms is to buy more like a large fleet. That means presenting suppliers with a predictable, aggregated demand rather than a series of one-off requests.

• Forecast annual requirements by port and grade across all your ships, and share them with preferred suppliers.
• Combine stems where ships call at the same hub in the same period.
• Consider term or frame agreements for regular ports, with pricing linked to a published reference.
• Work through an owner-side buying group or handling service that consolidates demand from several fleets.

Comparing offers properly

The lowest headline price is not always the cheapest delivery. Compare offers on a like-for-like basis that includes everything that affects the final cost and the risk.

• Delivered cost: barging or delivery charges, overtime, small-quantity surcharges and port dues.
• Delivery window: a supplier that cannot deliver on time can cost more in off-hire or delay than any discount saves.
• Payment terms: days of credit, currency and any security required.
• Specification: the grade and the ISO 8217 edition, 2017 or 2024, stated in the offer.
• Measurement: soundings or a mass flow meter, and the supplier's tolerance on quantity.
• Terms and conditions: time limits for raising quantity and quality concerns and any limits on the supplier's liability. Under the BIMCO Bunker Terms 2018, for example, liability is capped at the invoice value or USD 500,000, whichever is higher, unless agreed otherwise.
• Supplier record: licensing where a port requires it, quality history, and how the supplier has handled problems in the past.

Planning stems ahead

1. Build a bunker plan for each ship from its voyage schedule, consumption and tank capacity, covering at least the next two calls.
2. Identify where compliant fuel for ECAs and EU berths will be taken, and how much.
3. Send enquiries as soon as port and ETA are reasonably firm, using a standard template with all required details.
4. Keep a remaining on board margin so that a delayed barge or a failed quality test does not force an emergency purchase.
5. Review completed stems: price against the market, delivery performance, test results and quantity outturn.

Quality and quantity protection

A low price loses its value if the fuel is short or off-spec. An independent bunker surveyor and accredited laboratory testing cost little compared with the value of a delivery, and the results also give the buyer a factual record of each supplier's performance to use in future selection.

How the Atlas Bunkering model works

Atlas Bunkering is an owner-side bunker and lube oil handling service. It is not a supplier or trader and never takes ownership of the fuel. It works on the buyer's behalf throughout the process.

• Consolidation: demand is pooled across the fleets it serves, so small and mid-size owners can present suppliers with larger, more predictable volumes.
• Comparison: offers are compared with the help of AI tools, on the full basis described above rather than the headline price alone.
• Trusted suppliers only: owners are offered suppliers with a sound record, not simply the lowest quote.
• Transparency: the exact rate secured is passed on, and the supplier invoices the owner directly.
• Quality: Atlas strongly recommends an independent bunker surveyor and accredited laboratory testing on every stem, and arranges both on request.

Pricing is a prepaid annual subscription of USD 10,000, used as Atlas handles your orders: USD 1,000 per fuel stem, meaning one fuel grade delivered to one vessel, and USD 500 per lube oil supply. The balance covers ten fuel stems, twenty lube supplies or any mix. Further stems are charged at the same rates, and unused balance is carried over to the next year or refunded. The supplier invoices fuel and lubes directly to the owner, so owners see clearly what they pay for the product and what they pay for the service.

Questions and answers

Sources

1. BIMCO Bunker Terms 2018
2. IMO: Fuel oil availability and quality, MARPOL Annex VI regulation 18
3. ISO 8217:2024 Specifications of marine fuels
4. MPA Singapore Port Marine Circular No. 15 of 2019: mass flow metering for distillates

This guide is general information, not legal or technical advice. Check the current rules and your engine maker's guidance for your vessel.