VLCC Owners Struggle Despite Recovery in Demand

Press Release
Monday, March 25, 2013

The market continues to struggle, and Drewry's latest Tanker Insight report saw the Drewry Tanker Earnings Index suffer a further decline in February.

Weak demand hammered freight rates on major routes, especially for the larger vessel segments. The impact of weak rates was amplified by high bunker prices, which, for some operators, again translated into negative earnings.

Drewry’s Earnings Index for dirty tankers plunged by 66% to 14.2 during the month. This pulled the wider Tanker Earnings Index down by 52%.           
                                                                                      
Weakness in eastern demand due to the Chinese New Year holidays kept chartering activity in the Arabian Gulf relatively quiet. Similarly, despite increased demand from the Caribbean, activity in West Africa declined. This was largely because of weak European demand as a result of refinery maintenance and reduced shipments to eastern markets.

Rates for VLCCs on the benchmark Arabian Gulf-Far East route declined by 10 points to WS33. Similarly, Suezmax rates on the West Africa-U.S. Gulf route declined by 12%, leading to a sharp dip in earnings because of rising bunker costs. The shale oil boom in the US has reduced U.S. import demand for sweet crudes from Africa, in turn depressing Suezmax transatlantic trade.

Drewry predicts that the demand for VLCCs will primarily be driven by imports from the Far East in the near term. Although Asian countries receive most of their crude oil from the Arabian Gulf, the increased demand for light sweet crude, particularly from China might support the growth in chartering activity in West Africa.

www.drewry.co.uk
 

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

Tanker Trends

Tanker Retrofitted with Dual Fuel Engine

Caterpillar Marine informs it has begin a dual fuel engine retrofit conversion onboard the 472-foot Fure West tanker, owned by Furetank Rederi A/B. The MaK M 43

GasLog Orders Two LNG Carriers

GasLog Ltd. today announced that it has ordered two new 174,000 cubic meter LNG carriers from Hyundai Heavy Industries Co., Ltd. ("Hyundai") in South Korea.

Ondimar Firms Order Suezmax Quartet at Navantia

Navantia and Maritime Transport Ondimar LDA (shipping company Ibaizabal Group) today ratified the contracts signed in late June and the financial structure for

Finance

Harper Government Invests in Naufrage Harbor

The Honorable Gail Shea, Minister of Fisheries and Oceans, announced today an investment to improve safety and working conditions for fishermen at Naufrage Harbor, Prince Edward Island.

Strategic Marine’s Stock Program Full Power Ahead

Strategic Marine, the specialist shipbuilder and fabricator, has confirmed its stock program of personnel transport vessels is market-ready. “Our stock program

Shift to Contract Labor in U.S. Maritime, Offshore Sectors Underway

Maritime and Offshore recruiter Faststream has reported a shift in attitude towards temporary, project and consulting work following a recent survey to over 1,000 candidates in North America.

 
 
Maritime Security Maritime Standards Naval Architecture Navigation Offshore Oil Pipelines Pod Propulsion Ship Electronics Ship Simulators Sonar
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: 0.1197 sec (8 req/sec)