• Despite large increases in refined product retail prices, rates for water transport of those products did not increase proportionately. Tankers were increasingly priced out of the low-rate market.
  • Operation of terminals at razor-thin inventory margins, required reliable, on-time replenishment from the transportation system. Towed barges were very slow and not as reliable as ships were, schedule-wise.
  • Towed barges did not provide the weather-reliable transportation needed to work with reduced terminal inventories – but low rates excluded tankers from competing.
  • The weather was not going to change, and tankers were not going to get cheaper to build or to crew/operate. Somehow, the tug and barge solution had to be improved.
  • There was a shift in transport patterns. Less and less refined product moved from the Gulf to East coasts on the water, rendering the higher speed of a tanker less important.