Oil-Tanker Rates Gain Most in Two Weeks on Demand to Book Ships

Time:2013-05-24 Browse:67 Author:RISINGSUN
Charter rates for the largest oil tankers hauling Middle East crude to Asia rose the most in two weeks amid speculation demand to book vessels strengthened.


Hire costs for very large crude carriers on the benchmark Saudi Arabia-to-Japan voyage climbed 5.5 percent to 38.03 industry-standard Worldscale points, data from the Baltic Exchange showed today. The increase was the biggest since May 9 and also today’s largest change for crude tankers tracked by the London-based bourse.


The supply of supertankers available to load cargoes in the Persian Gulf over the next four weeks declined by four to 76, Marex Spectron Group said in an e-mailed note. Charter rates are rebounding from five sessions of declines that ended May 21 with the biggest slump since January.


“Despite resistance from charterers and brokers looking for cheaper levels, rates are finally starting to rise as expected,” Odysseas Valatsas, chartering manager for Athens-based Dynacom Tankers Management Ltd., said by e-mail. “Demand for vessels taking cargoes east increased and the supply of vessels in that region had declined.”


Daily earnings for VLCCs on the benchmark route almost tripled to $9,775 from $3,547 yesterday, according to the exchange. Its assessments don’t account for owners’ efforts to improve returns by securing cargoes for return-leg voyages or reducing speed to burn less fuel, the industry’s biggest expense. Each VLCC can hold 2 million barrels of crude.


The Worldscale system is a way of pricing oil cargoes on thousands of trade routes. Each individual voyage’s flat rate, expressed in dollars a metric ton, is set once a year. Today’s level means hire costs on the benchmark route are 38.03 percent of the nominal Worldscale rate for the voyage.


The biggest one-day change for ships moving refined fuels was for deliveries to northwest Europe from ports in the Baltic Sea, which climbed 8.3 percent to 186.07 points, extending yesterday’s 6.2 percent gain.