Low Sulfur Requirement Update
As follow-up to our July 1st announcement below, Crowley continues to analyze the additional cost impact of the required change from 1% Low Sulfur to 0.1% Low Sulfur Fuel on January 1
Based on current fuel prices, the cost INCREASE of 0.1% Low Sulfur Fuel is approximately $300 per metric ton. Crowley anticipates this additional per ton cost to translate into several million dollars of additional fuel expense per year. This is due to the thousands of metric tons of 0.1% fuel required to be used in the Emission Control Areas (ECA) as outlined in prior announcement below.
Crowley will be implementing a Low Sulfur charge or increase in November 2014 to cover the ADDITIONAL costs associated with the new required fuel. This date is due to the costs being incurred ahead of the January 2015 implementation date. The 2 month transition period is required to remove higher sulfur fuel from storage tanks in advance of implementation date. The amount of the Low Sulfur charge will be communicated in a subsequent announcement.
We will try to furnish as much information as possible in the days and weeks ahead leading up to this milestone date of January 1
If you have any questions please, contact your sales representative or the Customer Care Department at 1-800-276-9539.