Charter Rates Boost for Tanker Owners

Monday, December 10, 2007
Oil tanker owners are celebrating one of the industry's most notable turnrounds after charter rates for some vessel classes multiplied around seven times in the space of a few weeks. Owners of Very Large Crude Carriers (VLCCs), capable of carrying 2m barrels of oil, have been chartering their vessels for as much as $150,000 a day in the past two weeks, against only just over $20,000 in early November. The spike results mainly from industry fears about the effect on tankers of the strong market for shipping dry bulk cargo, where owners can earn up to $180,000 a day chartering out the largest, Capesize, ships.

Owners of single-hull tankers - due to be phased out for environmental reasons by 2010 - are increasingly converting them into bulk carriers, reducing the supply of tankers. The concerns have come just as many customers are seeking to ship oil to replenish depleted inventories. Market conditions are most beneficial for operators that concentrate on the short-term spot market, chartering out their vessels on a voyage-by-voyage basis, instead of agreeing long-term charters with customers such as oil majors.

Two Oslo-based owners - Frontline, operator of the world's largest tanker fleet, and US-listed Nordic American Tanker Shipping - are heavily exposed to the spot market. Nordic American currently owns 12 Suezmax tankers, carrying 1m barrels of oil each.

Some owners that charter their vessels out on a long-term basis have also benefitted, according to George Saroglu, chief operating officer of Athens-based, New York-listed Tsakos Energy Navigation. Many of his company's long-term charter agreements included an element linked to the spot rate.

However, there are questions about how long rates can stay at present levels. Saroglu said he expected similar market conditions for the next six to eight weeks, while conditions after that would depend on the severity of the northern hemisphere winter. Fearnleys, an Oslo-based tanker broker, says in its weekly report that conditions have already become more uncertain. Source: Financial Times

Maritime Today

The Maritime Industry's original and most viewed E-News Service

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

Tanker Trends

Idling Fleet Continues to Surge

Owners are rapidly laying up containerships as the market slows. The size of the idle fleet will get bigger while rates and profits slide, says Drewry Shipping Consultants Limited.

Egypt to Complete East Port Said Side Channel in 2016

Egypt plans to complete a side channel in East Port Said, near the Suez Canal, that would speed up shipping and allow ships direct entry into the port by the end of June 2016,

Concordia Maritime Charters MR Tanker

Concordia Maritime has signed a contract for the charter of an IMO2/3 class MR tanker, the company announced today. The vessel will be chartered jointly with Stena Weco,


Rates, Fees of Danish Maritime Authority to be Revised

A number of fee rates within the Danish Maritime Authority's area will be changed from 2016. The price schedule is available from the webpage of the Danish Maritime Authority.

Seagull's Software Tool for Benchmarking Seafarers Knowledge

Seagull Maritime has launched an advanced software tool able to benchmark seafarer knowledge levels, allowing shipowners and operators to compare their crew

Los Angeles to Host Annual 'Fleet Week'

Mayor Eric Garcetti and U.S. Navy officials announced today that Los Angeles has been selected as an official Fleet Week market for the U.S. Navy, beginning in 2016.

Maritime Careers / Shipboard Positions Maritime Contracts Naval Architecture Pipelines Pod Propulsion Salvage Ship Simulators Shipbuilding / Vessel Construction 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: 0.0648 sec (15 req/sec)