US ports strike threaten supply chains and bunkering sector eyes ripple effects

Dockworkers across 36 ports on the US East Coast and Gulf Coast walked off the job early Tuesday, launching the first major strike in nearly half a century and triggering fears of a widespread supply chain chaos.

PHOTO: Container vessel sailing in front of the Statue of Liberty. Port of New York and New Jersey

The strike, driven by wage disputes and concerns over automation, involves 45,000 members of the International Longshoremen’s Association (ILA), whose contract expired at midnight.

Despite last-minute negotiations showing signs of progress, the ILA members downed tools, rejecting an offer of a near 50% pay hike.

While the strike directly impacts container ships and cargo operations, the bunkering sector could face indirect challenges if smooth movement of bunker barges is disrupted in these ports, a source says.

Meanwhile, the broader impact on shipping is likely to cause ripple effects in fuel demand. “Containerships held up in port queues may refuel while they wait, which could spike demand at certain ports,” said one industry source. Conversely, if ships bypass the US ports to avoid delays, bunkering demand could fall sharply in key hubs like New York and Houston.

Prolonged congestion at the ports could also affect the availability of bunker fuel. Although oil and gas shipments are handled through separate operational facilities, disruptions in containerized cargo movements could tighten fuel oil supply chains. “Delays could stretch fuel inventories thin in some regions, which may push bunker prices higher, especially in busy markets,” another source explained.

By Debarati Bhattacharjee

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