Charter rates for the largest oil tankers hauling Middle East crude to Asia increased as the number of ships available for loading shrank.
Hire costs for very large crude carriers, each able to hold 2 million barrels, on the benchmark Saudi Arabia-to-Japan voyage gained 0.2 percent to 52.56 industry-standard Worldscale points today, according to the London-based Baltic Exchange. Daily income for VLCCs on the benchmark route advanced 7.7 percent to $14,250, according to the exchange.
The number of ships for hire in the Persian Gulf over the next four weeks shrank by 21 percent to 71, according to Kevin Sy, a Singapore-based freight-derivatives broker at Marex Spectron Group. There are 33 ships for 17 cargoes due to be loaded in the second ten-days of March, he said.
The vessel surplus means rates are unlikely to “ramp up,” he said, adding that some owners may not yet be marketing vessels that they have for hire in late March.
The exchange’s day-rate assessments don’t reflect speed changes that can cut fuel costs, vessel owners’ largest expense. The price of ship fuel, or bunkers, fell for a second session to $721.83 a metric ton, according to figures collected by Bloomberg from 25 ports worldwide, paring this year’s gain to 9 percent.
Worldscale points are a percentage of a nominal rate, or flat rate, for more than 320,000 specific routes. Flat rates for every voyage, quoted in U.S. dollars a ton, are revised annually by the Worldscale Association in London to reflect changing fuel costs, port tariffs and exchange rates.
The Baltic Dirty Tanker Index, a broader measure of oil- shipping costs that includes vessels smaller than VLCCs, decreased 0.4 percent to 781.
To contact the reporter on this story: Rob Sheridan in London at firstname.lastname@example.org
To contact the editor responsible for this story: Alaric Nightingale at email@example.com