Gus Majed, the CEO of the Paratus Group, addresses the risk management gap in the global bunker fuel and freight markets. The global bunker fuel market, consuming approximately 3.5m barrels per day, alongside the global freight market, with a staggering 900m dwt in dry and wet tonnage, plays a critical role in the world economy. However, beneath this massive scale lies a significant risk management gap, with only 3-5% of market participants equipped to handle the complex dynamics of fuel and freight price volatility. This leaves a vast majority—95% of participants—vulnerable to market fluctuations, primarily due to their lack of access to necessary hedging tools and expertise. This imbalance raises pertinent questions about market dynamics, corporate structures, and the future of risk management in these essential markets. Market dynamics and risks The disproportionate expertise within the global bunker fuel and freight markets can be attributed to the highly specialised knowledge required to manage these risks effectively. The minority who succeed in mitigating fuel and freight price risks are typically sophisticated traders and operators with in-depth market insight and advanced trading capabilities. These entities are adept at leveraging derivative hedging strategies to safeguard against volatile price shifts., a skillset that is neither widely available nor easily acquired. Conversely, the remaining 95% of market participants, often corporate entities domiciled as special purpose vehicles (SPVs) in offshore jurisdictions, face significant challenges. Many of these entities are set up to own and operate individual ships or fleets, primarily to isolate financial risk. However, their corporate structure and the nature of their domicile often exclude them from accessing sophisticated financial instruments, such as derivative hedging. The lack of in-house expertise further exacerbates their vulnerability to price risks, leaving them exposed to market volatility without adequate safeguards. Corporate structures and jurisdictions The corporate structure and domicile of these entities play a critical role in their risk management capabilities. SPVs, particularly those based in offshore jurisdictions, are typically established for tax efficiency and asset protection rather than operational sophistication. They often lack the necessary scale and resources to implement comprehensive risk management strategies. Additionally, the regulatory environment in some offshore jurisdictions can be less stringent, with fewer requirements for transparency and risk management, which may contribute to their inability to access essential financial tools. Regulatory and financial barriers further compound these challenges. Many banks and financial institutions are reluctant to extend derivative hedging lines to SPVs due to perceived credit risk and regulatory concerns. Without access to such hedging instruments, these entities remain exposed to significant market risks, which can have cascading effects on their financial stability and the broader market. An insurance-based solution for risk intermediation Effective risk management in the bunker fuel and freight markets requires specialised trading and operational knowledge. This includes a deep understanding of market trends, price drivers, and the ability to execute complex financial transactions. However, the scarcity of such expertise among the majority of market participants highlights the need for access