Singapore (Platts)--10Mar2011/846 am EST/1346 GMT
The Worldscale rate for moving crude from the Persian Gulf to North Asia on VLCCs has jumped by w10 points in the last five trading days to touch w70, with charterers in a hurry to cover their March-loading cargoes, shipping sources said Thursday. "The demand is quite firm these days and the number of stems seems to be on the upswing. There does seem to be some feeling [among] charterers [that] the oil supply [could] tighten in the near future," a Singapore-based broker said, adding that this feeling was exacerbated by the continuous unrest and the delay in damage control in Libya. The current rate of w70 on the benchmark Persian Gulf-Japan voyage would give shipowners earnings of between $34,000/day to $35,000/day on a VLCC, a Far Eastern shipowner said. "In the East of Suez the gap between demand and supply is closing, at least until the last decade of March and the first week of April lifting. Added to that is the bunker rate which has gone unexpectedly high," he said.Request a complimentary issue of: Oilgram NewsOilgram News brings fast-breaking global petroleum and gas news to your desktop every day. Our extensive global network of correspondents report on supply and demand trends, corporate news, government actions, exploration, technology, and much more. According to sources, the market could see a stand off now that most of the March-loading cargoes had been covered and there could be a feeling among the charterers that the market has already reached its peak. "I have counted the number of vessels. There are 60 [ships] and it is completely oversupplied for the third decade [loading]. So, the market has chances to go down," a Far Eastern chartering source said. "The owners are still [staying] strong. But looking at the position list, it is going to be difficult to maintain the w70s." Around 94 spot loading cargoes have been covered out of the Persian Gulf and the Red Sea so far for March, while close to 10-15 stems may be outstanding for this month. "The market will not go above w70. We don't see that happening. For the third decade, there is enough tonnage in the market and [the rates will stay in the w60s] for the second decade," a source with a VLCC shipowner said, adding that there was no further room to go up.--Pradeep Rajan, pradeep_rajan@plattts.com
The Worldscale rate for moving crude from the Persian Gulf to North Asia on VLCCs has jumped by w10 points in the last five trading days to touch w70, with charterers in a hurry to cover their March-loading cargoes, shipping sources said Thursday. "The demand is quite firm these days and the number of stems seems to be on the upswing. There does seem to be some feeling [among] charterers [that] the oil supply [could] tighten in the near future," a Singapore-based broker said, adding that this feeling was exacerbated by the continuous unrest and the delay in damage control in Libya. The current rate of w70 on the benchmark Persian Gulf-Japan voyage would give shipowners earnings of between $34,000/day to $35,000/day on a VLCC, a Far Eastern shipowner said. "In the East of Suez the gap between demand and supply is closing, at least until the last decade of March and the first week of April lifting. Added to that is the bunker rate which has gone unexpectedly high," he said.
Oilgram News brings fast-breaking global petroleum and gas news to your desktop every day. Our extensive global network of correspondents report on supply and demand trends, corporate news, government actions, exploration, technology, and much more.