Freight Rates To Fly High In Coming Years

Wednesday, April 25, 2001
The U.S. will become more dependent on tanker-borne petroleum imports in coming years, coinciding with a ship shortage which will push freight costs sharply higher, energy and tanker analysts said on Wednesday. "Products imports are playing a bigger swing role in the U.S. than ever before," Paul Horsnell of Oxford Institute of Energy Studies said. "They're becoming a structural feature of the U.S. system."

Horsnell told members of the tanker owners' organization Intertanko, which met in Sydney this week, that each year was now expected to bring a fourth quarter surge in demand for fuel oil imports -- a trade usually served by Panamax 50,000 tonrs. U.S. demand for gasoline imports would surge each spring. Intertanko research head Erik Ranheim said U.S. products imports in January were the highest in 10 years.

He also forecast dramatic increases in demand for Aframax crude tankers (75,000-120,000 tons), many of which trade to the United States. But this year tanker supply is not expected to keep up with demand in these trades. A report this month by a leading tanker broker said the world fleet of smaller tankers in both crude and product trades would remain static in 2001 and in some sectors could even contract. "Continued tight supply is likely to make Aframax tankers the over-performers of 2001," said London broker SS&Y. This is likely to be mirrored in the Panamax sector, where an "acute shortage" of modern ships will force up rates, SS&Y said.

Last year, Aframax freight rates hit their highest levels in 30 years, doubling or even tripling over the course of the year in most markets. The biggest gain was seen in the Caribbean, where rates nearly quadrupled between January and the year's high point in November of $2.30 per barrel for up-coast cargoes. Horsnell said the United States was increasingly obliged to import petroleum products because of under investment in the U.S. downstream industry. "The system lacks profitability in all aspects," he said.

Horsnell said the problem was illustrated when fog closed the Houston ship channel for several days in March, seriously affecting product stocks. "That's symptomatic of a system where all the flexibility has been depreciated. It hangs together, and they make it work, but there's no flexibility," he said. - (Reuters)

Maritime Reporter August 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Contracts

G E Shipping delivers “Jag Aakash” to Buyers

The Great Eastern Shipping Company Ltd. (G E Shipping) delivered the new building Kamsarmax Dry Bulk Carrier “Jag Aakash” (81,600 dwt) to the buyers.  The vessel

Otto Marine Signs Contracts to Supply 2 AHTS Vessels

Go Offshore,  wholly-owned subsidiary of Otto Marine has entered into an agreement for two long-term anchor handling tug supply (AHTS) charter contracts worth USD25.

Husain appointed ABB’s CTO

ABB, the leading power and automation technology group, has appointed Bazmi Husain as Chief Technology Officer (CTO), effective January 1, 2016. Husain, an expert

Tanker Trends

Dorian Acquires 2 ECO VLGC

Dorian LPG, an owner and operator of modern Very Large Gas Carriers ("VLGCs"), reported today that it has taken delivery of the ECO VLGC Commodore from Hyundai

Egypt Picks Jordan LNG Cargo Winners

Egypt has picked Shell, Vitol and Trafigura in a tender to supply four cargoes of liquefied natural gas (LNG) via Jordan's Aqaba import terminal, trade sources said.

SHIPPINGInsight to Focus on Ship Telematics

The subject of ship telematics will be prominently featured at the upcoming SHIPPINGInsight 2015 Fleet Optimization Conference & Exhibition, which takes place in Stamford, Conn.

 
 
Maritime Contracts Naval Architecture Navigation Offshore Oil Pipelines Ship Electronics Ship Repair Ship Simulators Sonar Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2855 sec (4 req/sec)