Recent estimates from the European Federation for Transport and Environment suggest the Persian Gulf crisis is now costing global shipping around $400 million per day in additional operating costs compared with pre-crisis conditions. While some of this burden will eventually be passed downstream into freight rates and consumer prices, the immediate impact is currently being absorbed by operators. At the same time, bunker costs have effectively doubled, rising from roughly $400 per tonne for Very Low Sulfur Fuel Oil (VLSFO) to around $800 per tonne. With ongoing constraints on heavy crude supply, it is likely that the true knock-on effect on bunker prices is yet to be fully realized.

This is not an isolated shock, but part of a broader pattern. Geopolitical volatility and market uncertainty have significantly impacted shipowners’ operational strategy in recent years, and this trend seems destined to continue. The outbreak of the Russia-Ukraine conflict in 2022, combined with the Houthi attacks in the Red Sea, had already placed a significant burden on shipping companies’ opex, curtailing global oil supplies whilst also extending voyage times due to diversions around the Cape of Good Hope.      Against this backdrop, fuel efficiency is no longer a marginal optimization exercise; it has become a fundamental driver of shipowners’ operational strategies.   Shipping’s energy demand and associated costs are rising fast, with global bunker sales forecast to approach a staggering quarter of a trillion dollars by 2026. In this context, understanding the scale and sensitivity of fuel expenditure is best illustrated at a vessel level. For example, a modern VLCC consumes approximately 20,000 tonnes of fuel per year. At $400 per tonne, fuel expenditure equates to $8 million per annum. However, since the outbreak of the Persian crisis, that figure has doubled to $16 million. Nothing about the vessels have changed; however, the financial exposure has.      This market reality re-frames the efficiency discussion. A 5% fuel saving under previous pricing conditions might have delivered $400,000 in annual benefit. Today, the same efficiency gain delivers $800,000. This completely alters the decision-making algorithm when it comes to investing in—and payback for—clean technology and fuels.     For an industry that has historically operated as a price taker on fuel, this represents a key inflection point. At a macro level, global bunker expenditure now represents at an extraordinary portion of shipowners operating costs, and it is within this context that even small percentage improvements translate into system-level financial impact. However, alongside rising costs, shipping continues to face a parallel challenge of sustained uncertainty over the long-term alternative fuel pathways. Regulatory fragmentation, insufficient supply of nascent alternative fuel technologies, and uneven infrastructure development have created a climate of stasis when it comes to decisive financial investment. Rather than focusing on a single dominating fuel, the market is increasingly moving towards a mix of solutions, reflecting the different operational requirements and commercial priorities of individual owners.   Each fuel pathway will bring trade-offs depending on vessel type, trading route, and operational profile. Waiting for technological viability at the required scale risks delaying meaningful progress at precisely the moment when both emissions reduction and cost control are most urgent.      The industry does not need a perfect fuel. It needs deployable solutions that reduce cost, improve efficiency, and lower emissions within established infrastructure.   This is where established fuel innovation that works within existing systems becomes particularly relevant. Technologies that utilize lower-value refined crudes whilst improving feedstock flexibility, and enhancing combustion efficiency offer a pragmatic bridge between current operational realities and future fuel ambitions.      One such approach has been developed by Quadrise, which has focused on emulsion fuel technologies for two decades, that are specifically designed to integrate directly into existing marine infrastructure.      Quadrise MSAR fuel demonstrates how this approach can translate into operational and economic gains without the need for substantial retrofitting. In medium and slow speed diesel engines, MSAR has been shown to improve fuel consumption by approximately 3-6% on an energy-to-power basis. In practical terms, this equates to a saving of $24 to $48 per tonne saving, equivalent to $480 to $960 per tonne saved per day, and $480,000 to $960,000 per annum for a VLCC.     Beyond cost efficiency, MSAR also delivers performance and environmental benefits, which includes reduced NOx emissions by 20-45 % so enables approximately 7-9% more energy extraction per barrel compared to conventional fuels, while improving refinery margins by upgrading low-value residuals into higher-value marine fuel.   MSAR also lays the foundations for the integration of bioMSAR, which delivers emissions reductions of over 20% compared with heavy fuel oil (HFO), while maintaining compatibility with existing propulsion systems.      The significance of these developments lies not in positioning them as a single solution, but in demonstrating a blueprint for practical transition. In a market constrained by a lack of capital commitments, infrastructure incompatibility, and geopolitical volatility, technologies that reduce both opex and emissions simultaneously are uniquely positioned.       The current crisis has further highlighted the importance of fuel flexibility. As geopolitical tensions continue to disrupt energy markets and expose supply chain vulnerabilities, the ability to remain flexible and avoid dependence on a single fuel pathway has become a strategic advantage. The maritime industry does not have the luxury of waiting for a fully mature hydrogen economy or a globally standardized alternative fuel network. It must operate in the present while transitioning toward the future. That requires solutions that are immediately deployable and scalable under current fuel price conditions.   Ultimately, the current bunker market is necessitating a shift in mindset. Efficiency is no longer about incremental gains; it has become a business imperative. In an era defined by volatile fuel markets, supply chain disruption and geopolitical uncertainty, shipowners must act decisively to utilize the solutions that are at their fingertips to secure vital cost and emissions savings, while preserving the flexibility to adapt as the future fuel landscape continues to evolve.

Peter Borup is the CEO of Quadrise, an energy technology provider developing alternative fuels for marine and industrial applications.