"Perhaps nothing in our industry was more welcome than the end of 2010," wrote World Fuel Services Chairman and CEO Paul Stebbins a year ago. "It was a long, difficult year," he noted, pointing to a struggling world economy, volatile rates and bunker prices, squeezed refining margins, tightening credit conditions, and falling bunker sales. And yet, looking back at 2011, it seems things went from bad to worse. The outlook for 2012 appears moderately optimistic, at best, and downright scary at worst. Following several shipping company casualties last year, many fear trading conditions in 2012 will lead to further bankruptcies. Counter party risk could get worse, especially as shipping firms now face a credit crunch without the cash reserves they had built up during the boom years prior to the 2008 global financial crisis. Tightening credit terms on bunker purchases seen during 2011 will likely continue as large sums are involved and suppliers are wary of the financial health of buyers.
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