eorge had a contract to supply fuel to Eberhardt for Eberhardt$$s fleet of tugboats at a fluctuating market price. Due to supply problems, fuel prices doubled in a week. Eberhardt, realizing he couldn$$t pay the cost of running his fleet, tied his tugs up at the wharf. George, facing no sales of fuel at all to Eberhardt, promised to reduce what he charged to Eberhardt to a lower price. Eberhardt agreed to put his fleet back on the water and resume purchasing fuel at the new price offered by George and did so$.$ After a few weeks, George tried to collect the cost of fuel at the old price, reneging on his offer to reduce the price. $($Note: This is an example where the doctrine of promissory estoppel applies.$)$

In this situation, if George had contracted with Eberhardt to supply fuel at a fixed price for a specific period, and then said he could not supply the fuel unless he had a $20$ percent increase, because his costs had risen by that much:

Question $33$ options:

Eberhardt would be obliged to pay, as he cannot expect George to absorb all of the rising costs of fuel.

George can stop supplying fuel if he is going to run up losses in honouring the agreement.

Eberhardt is under no obligation to pay the surcharge, as George has to honour the terms of the existing contract. Also, George would be wise to include a clause tying his price to Eberhardt to his cost of obtaining fuel in a market where prices fluctuate.

Eberhardt would be obliged to pay a one$-$time payment to George for part of the rising cost.