One of the world’s leading container shipping companies, CMA CGM, has initiated a lawsuit against Houston-based bunker supplier GCC Supply & Trading, seeking over $5 million in damages. The lawsuit stems from allegations that contaminated marine fuel supplied in early 2023 caused significant damage to 13 of CMA CGM’s vessels.
CMA CGM is suing GCC Supply & Trading for over $5 million due to fuel contamination.
The contaminated fuel caused operational issues in 13 vessels, including engine failures and blackouts.
The lawsuit claims breach of contract, negligence, and product liability.
Background of the Incident
Between March and June 2023, CMA CGM took delivery of approximately 33,628 metric tons of Very Low Sulfur Fuel Oil (VLSFO) at the Port of Houston. Shortly after the fuel was loaded onto their vessels, the company reported severe operational issues, including:
Fuel pump failures
Internal combustion unit (ICU) leakages
Sudden loss of engine power
Propulsion problems leading to complete blackouts
These issues resulted in physical damage to various systems on the affected vessels, including fuel tanks, engines, and purifiers.
Allegations Against GCC Supply & Trading
CMA CGM’s legal filing accuses GCC of supplying fuel that was not only contaminated but also unfit for use in ship engines. The company argues that GCC failed to adhere to proper industry practices for testing and screening its fuel for harmful chemical components. CMA CGM contends that GCC should have been aware of the risks associated with the fuel it provided.
The lawsuit outlines several grounds for the claim, including:
Breach of Contract: CMA CGM asserts that GCC did not fulfill its contractual obligations regarding the quality of the fuel supplied.
Negligence: The supplier is accused of failing to ensure the fuel met industry standards.
Warranties and Product Liability: CMA CGM claims that the fuel was defective and caused physical harm to its vessels.
Impact on CMA CGM
The contamination incident has led to significant operational disruptions for CMA CGM, resulting in:
Increased operational costs
Delays in shipping schedules
Loss of business opportunities
CMA CGM is seeking a jury trial to determine the total amount of compensation for the damages incurred.
Industry Context
In July 2023, marine fuel testing firm VPS (Veritas Petroleum Services) reported a contamination incident at the Port of Houston, identifying high levels of dicyclopentadiene (DCPD) in VLSFO deliveries from a single supplier. DCPD is known to make fuel sticky and more viscous, which can severely disrupt engine performance. VPS confirmed that a total of 14 vessels received contaminated fuel, with 12 of those supplied in Houston.
This incident is not isolated; earlier in March 2023, over 200 ships were affected by similar fuel contamination issues in Singapore, prompting regulatory investigations and penalties against the responsible supplier.
