Tanker Rates React To OPEC

Tanker rates to the West firmed as charterers and operators took on board the implications of OPEC's decision to raise oil output, brokers reported. Rates of W68.5 ($11.50 per ton) for 280,000 tons to Europe and 255,000 tons to the U.S. Gulf ($11.75) were a Worldscale point or so above last done, brokers said. But the market appeared to be acting in a schizophrenic manner to the Far East where rates at best held for South Korea at W77.5 (about $7.50 per ton) and one fixture of an older vessel, the New Vitality, was reported at W74.5 ($7.00). Most brokers said the extra oil promised by OPEC should keep rates at current levels, but some said they expected some seasonal weakening to occur. The until-now strong West African market slackened off toward the end of the week by up to five Wordlscale points to W125 ($11.50 per ton) to the U.S. Gulf for one million barrel Suezmax units. Thin trading for Aframaxes in the Mediterranean resulted in rates slipping to around W150 ($5.00 per ton) for the 80,000 ton ships, broker E.A Gibson said in a report. But Suezmaxes strengthened in the area on increased activity out of Ceyhan to about W120 ($4.00 per ton). The North Sea Aframax market continued to weaken with modern vessels now fixing as low as W125 ($4.50 per ton) and older ships at W112.5 (close to $4.00). Some of the decline may have been attributable to parceling up into Suezmaxes. Caribbean trading continued at W210 ($8.50 per ton) for 70,000 tons for the second week running. Fuel oil 50,000 tonrs also remained strong at around W250 ($10.00).