Mideast Crude Tanker Earnings Slip, Ukraine Watched

MarineLink.com
Tuesday, March 04, 2014

By Jonathan Saul, Reuters

Crude oil tanker earnings on the major Middle East route fell on Tuesday as a build up of vessels available for hire weighed on rate sentiment.

Shipping markets continued to monitor developments in Ukraine after Russia sent military forces into the Crimea region of southern Ukraine. Russian President Vladimir Putin said Moscow would only use military force in Ukraine as a last resort. A U.S. official said it was ready to impose economic sanctions on Russia.

The world's benchmark VLCC export route from the Middle East Gulf (MEG) to Japan reached W50.73 in the Worldscale measure of freight rates, or $25,765 a day when translated into average earnings.

That compared with W51.33 or $27,219 a day on Monday and W55.05 or $32,176 a day last Tuesday.

"Higher available capacity in the Middle East continues to weigh on rates out of the region to both Asia and the U.S. East Coast," said Justin Yagerman with Deutsche Bank.

"While the number of available VLCCs in the Middle East decreased by 4 last week to 83, the level remains elevated from a historical perspective."

In January, average earnings reached $61,630 a day - their highest level since February 2010, before that rally lost steam.

VLCC rates from the Gulf to the United States <DFRT-ME-USG> were at W31.63 on Tuesday versus W32.77 on Monday and W34.17 last Tuesday.

Russian navy ships have blocked off the Kerch Strait, which separates Ukraine's Crimea region and Russia, Ukraine's border guard service said on Tuesday. The border guards said the action did not affect civilian traffic through the Strait, which provides access to the Black Sea for ships carrying commodities including grain and oil from Russia.

"Given the sheer size of Russia's energy exports, we would find Western sanctions that actually bite, or Russia ceasing exports as a political tool, both somewhat far-fetched scenarios at this time," said Urs Dur of Clarkson Capital Markets.

"However, if either were to happen, the LNG (liquefied natural gas), crude and product tanker markets would likely spike, as would the price of oil and natural gas, possibly causing significant disruption to the global economy."

Black Sea and Mediterranean crude tanker rates continued to weaken after rallying in January to their highest since 2008 as weather-related disruptions in the Turkish Straits raised the cost of transporting cargoes. Brokers said slower activity had taken its toll on rates.

Rates for suezmax tankers on the Black Sea to Med route to W65.65 or $8,632 a day. That compared with W65.75 or $9,270 a day on Monday and W61.83 or $5,261 a day last Tuesday.

Cross Mediterranean aframax tanker rates were at W86.93 or $7,762 a day on Tuesday. That compared with W87.88 or $8,765 a day on Monday and W84.03 or $6,180 a day last Tuesday.

Average earnings per day are calculated after a vessel covers its voyage costs such as bunker fuel and port fees.

(Editing by David Evans)

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

Finance

Work Begins on $1.6 bln Container Terminal at Jebel Ali Port

DP World Chairman Sultan Ahmed Bin Sulayem announced the start of construction work on a brand new container terminal at Jebel Ali Port, Dubai.   Phase 1 of the

Singapore MPA Wants LNG Bunkering Options

Singapore's Maritime Port Authority is seeking proposals on liquefied natural gas bunker supplies as it shifts away from fossil fuels towards gas while trying to

China's Navy Drills in South China Sea

China said it conducted air and sea drills in the South China Sea on Tuesday as it stakes an increasingly assertive claim to virtually the whole sea despite rival claims by neighbours.

Energy

Idreco Delivers Dredger for Hydro-Dam in Congo

Idreco (International Dredger Constructions) of the Netherlands informs it has designed, built and installed its second dredger, an ISD 600 with a digging depth of 30 meters,

Offshore Wind Shift to Drive Vessel Services Cooperation

Evolving procurement processes for U.K. Round 3 offshore wind farms will require a greater number of work streams, personnel with new and differing skills, and

Damen Delivers First Twin Axe FCS for O&G

Damen Maaskant Shipyards Stellendam have a decade-long relationship with the family-run Groen Offshore, Guard & Support, having built seismic research vessels and

News

Idreco Delivers Dredger for Hydro-Dam in Congo

Idreco (International Dredger Constructions) of the Netherlands informs it has designed, built and installed its second dredger, an ISD 600 with a digging depth of 30 meters,

BAE Systems Awards Software Contract to SENER

The Spanish company SENER, Ingeniería y Sistemas S.A has closed a contract with U.K.-based BAE Systems PLC for the integration between FORAN CAD/CAM System and

Hawboldt Secures Cape Sharp Tidal Winch Deal

A third Nova Scotian company has secured a multimillion dollar contract with the Cape Sharp Tidal project, which has potential to be the first grid-connected tidal array in the world.

Logistics

Egypt to Allow 24-hour Access to East Port Said with New Waterway

Egypt plans to allow smaller vessels in the Mediterranean direct access to East Port Said around the clock instead of just eight hours a day by building a side channel near the Suez Canal,

Offshore Wind Shift to Drive Vessel Services Cooperation

Evolving procurement processes for U.K. Round 3 offshore wind farms will require a greater number of work streams, personnel with new and differing skills, and

Work Begins on $1.6 bln Container Terminal at Jebel Ali Port

DP World Chairman Sultan Ahmed Bin Sulayem announced the start of construction work on a brand new container terminal at Jebel Ali Port, Dubai.   Phase 1 of the

Middle East

Egypt to Allow 24-hour Access to East Port Said with New Waterway

Egypt plans to allow smaller vessels in the Mediterranean direct access to East Port Said around the clock instead of just eight hours a day by building a side channel near the Suez Canal,

Work Begins on $1.6 bln Container Terminal at Jebel Ali Port

DP World Chairman Sultan Ahmed Bin Sulayem announced the start of construction work on a brand new container terminal at Jebel Ali Port, Dubai.   Phase 1 of the

UASC Appoints New Board Leaders

United Arab Shipping Company (UASC) announced the appointment of Dr. Nabeel Al-Amudi as the new Chairman of the Company’s Board of Directors, and Sheikh Ali bin Jassim bin Mohammad Al-Thani,

 
 
Maritime Contracts Maritime Security Maritime Standards Navigation Pipelines Pod Propulsion Salvage Ship Repair 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: 4.8531 sec (0 req/sec)