Bloomberg News

Oil-Tanker Surplus Seen by Clarkson Persisting for a Third Year

January 30, 2013

An oversupply of the largest oil tankers will persist for a third year even as deliveries of Middle East crude to Japan, South Korea and China gain 6 percent, said Clarkson Plc.

The combined capacity of the fleet of 610 very large crude carriers will exceed demand again this year, London-based Clarkson, the world’s biggest shipbroker, said today in a report published on its website. That’s even with a second year of lower vessel supply, it said.

Crude shipments to Asia from the Middle East on VLCCs will rise to 8.5 million barrels a day, according to Clarkson. Deliveries will expand 7 percent on the route from West Africa, it predicted. Each of the ships can hold 2 million barrels of oil, three times as much as an Aframax vessel.

Demand for VLCCs is poised to increase 5.9 percent, more than the fleet’s projected 5.3 percent growth, the report showed. Still, the forecasts equate to a requirement for vessels with total capacity of 161.8 million deadweight tons, against the fleet’s 194.6 million tons, Clarkson said.

Average daily earnings for VLCCs slumped 43 percent last week to $14,090, the lowest level since October, amid slack demand, Clarkson said. The average of $26,813 for last year was the second-lowest in a decade and 28 percent of the peak figure reached in 2008, figures showed.

Overall seaborne crude exports are estimated to rise 2.1 percent to 38.2 million barrels a day this year even as daily shipments to the U.S., the biggest importer, fall 3 percent to a two-decade low of 6 million barrels, the report showed. Deliveries to China will gain 11 percent, Clarkson said.

VLCCs will carry 48 percent of the world’s seaborne crude this year, gaining market share at the expense of Aframaxes that will ship 29 percent, Clarkson data show. Daily deliveries by the smaller tankers will fall 3.2 percent to 11 million barrels on a drop in cargoes for Europe and the U.S., the two largest Aframax destinations, the shipbroker said.

To contact the reporter on this story: Michelle Wiese Bockmann in London at mwiesebockma@bloomberg.net

To contact the editor responsible for this story: Alaric Nightingale at anightingal1@bloomberg.net


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