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

Tanker Trends

Jotun, COSCO Celebrate 10,000th Antifouling Applications

In July, Jotun and Dalian Ocean Shipping Company (a wholly-owned subsidiary of China Ocean Shipping Company, Cosco Group), celebrated the 10,000th application of SeaQuantum,

Asia Tankers-VLCC Rates Will See More Volatility

VLCC market to be "hot" in Q4 -VLCC broker. Freight rates for very large crude carriers (VLCCs) face a roller-coaster ride on uncertain cargo volumes and vessel

Libya Plans to Sell Ex-rebel Tanker

Libya plans to sell a tanker that a former rebel group used in an attempt to bypass the Libyan government and export oil on its own last year, the Tripoli-based state prosecutor said on Thursday.

Finance

Timing in Doubt on Hapag-Lloyd IPO

German container shipping group Hapag-Lloyd has taken further steps in preparation of a stock market listing and has mandated more banks for the move, but it remains

Asia Tankers-VLCC Rates Will See More Volatility

VLCC market to be "hot" in Q4 -VLCC broker. Freight rates for very large crude carriers (VLCCs) face a roller-coaster ride on uncertain cargo volumes and vessel

HII Wins $109.4mln U.S. Navy Contract

Huntington Ingalls  has received a $109.4mln contract modification to carry out support services for the U.S. Navy’s nuclear submarines.   The company will work to engineer,

 
 
Naval Architecture Navigation Offshore Oil Pipelines Pod Propulsion Port Authority Salvage Ship Repair Shipbuilding / Vessel Construction 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: 0.2994 sec (3 req/sec)