Algoa Bay offshore bunkering shutdown has limited the country’s capacity to cater to high bunker demand from vessels being rerouted through Africa due to the Red Sea crisis, it said.

The Maritime Business Chamber (MBC) of South Africa said the crisis in the Red Sea has created a lucrative opportunity for the country to meet the bunkering needs of vessels being redirected through Africa. However, with the offshore bunkering suspension in Algoa Bay still in place, the anchorage has missed out on this increased demand.

The suspension of offshore bunkering in Algoa Bay since 12 September has thwarted South Africa from fulfilling this opportunity, the MBC noted. Offshore bunkering in Algoa Bay came to a standstill after the South African Revenue Services (SARS) detained bunker barges over import duty disputes.

Since then, no offshore bunkering has been carried out in Algoa Bay. Supply has been mostly limited to in-port deliveries by one supplier in Port Elizabeth.

The MBC has termed the detention an “abrupt moratorium” by SARS. Calling it an “ill-advised” decision. The MBC highlights that “it was a significant misstep that hampered South Africa’s golden opportunity in the maritime sector”.

It went on to say that the actions of SARS have significantly impacted South Africa’s ability to play a pivotal role in international shipping, especially given the current situation in the Red Sea.

The geographical location of Algoa Bay makes it an ideal location for bunker-only calls. With an offshore anchorage up to 42 meters deep, Algoa Bay is a mere 30 nautical miles away from the vessel traffic flow to the Americas, Europe, Asia and Africa. Moreover, it is located near two ports — Port of Ngqura and Port Elizabeth.

Shipping firms have diverted vessels around the Cape of Good Hope to avoid heightened tensions in the Red Sea due to attacks by the Houthi militia. This has boosted bunker demand in South African ports, as well as other bunker locations in Mozambique and Mauritius.

Offshore bunkering in Algoa is likely to resume on 1 February, a port agent told ENGINE. However, some traders argue that the mentioned date appears to be speculative as no official confirmation has been announced from South African authorities.
Source: Reuters (By Manjula Nair)