As a seafarer, especially one who works in the gas and oil industry, there are many global factors that could have an effect on your job security. One of the main things that can have a negative effect on today’s seafarers is the price of oil. Whether the price of oil goes up, or it goes down, seafarers working in this industry are typically the first to feel the effects.
Why does this happen and what can British seafarers do in this instance. Unfortunately, there isn’t much a seafarer can do when oil prices increase. They face increased working hours, more shifts and fewer layoffs if oil prices don’t stabilise or they remain too low for too long. The best way to prepare for this as well as some of the other effects of reduced oil prices is to understand why they rise and fall in the first place so we can be prepared before they actually feel the effects in their paychecks.
The Knock On Effect On Seafarer Jobs
Why do falling oil prices have such a detrimental effect on British seafarers? It all comes down to supply and demand and the idea that:
- Higher Freight Rates = Higher Profits
- Higher Profits = Higher Salaries / More New Buildings / More Job Opportunities
You see, when crude oil prices are high, there are fewer opportunities to make money as a seafarer in the oil and gas industry. But when oil prices fall, there is more profit and more profit means that freight rates are on the rise. When this happens, salaries and new opportunities begin to increase. While it might seem unfair, such is life when working in international waters where global trade dictates just about everything.
How Low Prices Impact The Shipping Industry
Let’s take a look at how low prices impact the shipping industry directly. For starters, bunker prices, the fuel required to run a ship, drops. This is good, because it means that it will cost less to operate the ship and there will be more profits. But if oil prices remain low, we could see more storage tankers and that means more job opportunities for seafarers. That’s a good thing.
Secondly, freight prices will increase. Remember, higher freight rates = higher profits. and higher profits = higher salaries and more job opportunities. This, again, is a good thing.
So, even though a reduction in crude oil prices might seem like there are fewer opportunities for British seafarers working in the gas and oil industry, the opposite is true.
Contact Binks Overseas
To learn more about International Payroll Services In Denmark, Norway, Finland, Italy, France and Greece from Binks, contact Binks Overseas today and speak with a payroll specialist who can answer any questions you might have about your company’s payroll needs.
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