Marine Log - February 2009 - (Page 4) Nick Blenkey Senior Editorial Consultant Second Thoughts A very challenging new year W e’ve been running a “Happy New Year?” poll on marinelog.com that poses the question, “What will be the biggest marine industry challenge in 2009?” Not surprisingly, the number one worry among respondents (37%) is the credit crunch. More remarkably, the challenge that’s perturbing poll takers least is fuel costs (11%). For the rest, worries are pretty evenly divided among the remaining choices. Freight rates/day rates were the number two cause of concern (17%), personnel issues came in at number three (15%), while environmental regulations and security concerns each got a 14% “pass the aspirin” rating. The poll is not particularly scientific, but it’s probably as good a guide as any as to what most readers are concerned about. The credit crunch is a major issue for many in the industry, particularly some smaller shipyards. Workers are being sent home because banks are not coming up with the credit needed to continue very viable projects. The problem seems to be happening around the world. Interestingly, in at least two recent cases (one in Quebec, the other in Pennsylvania), the yards concerned were both supposedly going to be the recipients of sizeable infusions of public money. It turns out that there’s a huge time delay between public officials going on stage and announcing these big dollops of largesse and the checks actually getting cut. The harsh truth is that, historically, yards have often enough found themselves in this sort of situation and have either worked their way out or have not. There’s no simple formula for predicting who the survivors will be in times like these. Though fuel costs are now what worry readers the least, according to the poll, we might have gotten a very different result if we’d put the choice as “oil prices.” For some in our industry, the price of oil has now fallen Vote on marinelog.com to too low a level. That’s because exploring and producing offshore resources from deepwater leases doesn’t make sense when oil falls below a certain magic price. At press time the price of oil was around $42 a barrel. That might not seem to justify some deepwater ventures, but remember, deepwater leaseholders are looking at what they’ll get when they start producing oil, not at the price during drilling. Another reason to be a little worried about oil prices being on the low side is that it takes away a natural incentive to conserve fuel and thus lower emissions— making it easier for some to argue for a carbon tax on bunker fuels. All of this is a long way from the situation when gas was around $4 a gallon and “Drill, baby, drill” was an election mantra. In an earlier poll, at that time, we asked readers whether a Congressional embargo on drilling in most U.S. waters would be lifted before the end of the Bush administration. Most of us got that one wrong and the embargo has gone away. But with the price of gas at the pump now less than half what it was in the run up to the election, don’t be too surprised if there’s a dilution of the political will to expand areas open for drilling. Getting back to previous polls, another one we ran that got widespread response was on the subject of how to deal with piracy, where 47% of readers thought the most effective solution to the problem was to hire an on-board security team. Judging by comments posted on the poll, most of our respondents take it that an on board security team should be armed with guns rather than with nonlethal deterrents. As it happens, a stepped up naval presence in the area seems to have diminished the number of successful hijackings. Yet, as this was being written, news was breaking of the third ship seizure of 2009, a German-owned LPG tanker, underscoring the fact that the pirate threat remains very real. We plan more polls in the months ahead. If you have any thoughts on suitable topics, email them to us! nblenkey@sbpub.com 4 MARINE LOG FEBRUARY 2009 www.marinelog.com http://www.marinelog.com http://www.marinelog.com http://www.marinelog.com
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