New challenges in fleet deployment considering EU oil sanctions

Abstract

Due to European Union (EU) oil sanctions, tanker shipping companies need to redeploy their tankers by moving tankers between ship routes with the consideration of flag states of tankers, but the literature lacks quantitative methods for this problem. To fill this research gap, this paper studies an integrated problem of fleet deployment, fleet repositioning, round trip completion, and speed optimization with the consideration of flag states of tankers. The problem is formulated as a nonlinear integer programming model to minimize the total cost, including the fleet repositioning cost, the mismatch cost, and the fuel cost, during the planning period while satisfying the total crude oil transportation demand of each voyage and the minimum shipping frequency. Some linearization methods are used to transform the nonlinear model to a linear one which can be directly solved by Gurobi. The average solving time required for 17 computational instances is 4.5 minutes, which validates the effectiveness of the proposed model. Sensitivity analyses, including the influences of the unit fuel price, the total crude oil transportation demand, the mismatch cost of completing a round trip by a deployed tanker, and the repositioning cost for each deployed tanker, on operations decisions, are conducted to obtain managerial insights.