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- Dubai 05:27 06:40 12:34 15:52 18:23 19:37
The cost of delivering Middle East crude oil to Asia, the world's busiest route for supertankers, has increased, capping the first weekly advance in three weeks.
Charter rates for very large crude carriers (VLCCs) rose 7.5 per cent to 67.97 Worldscale points on the benchmark Saudi Arabia-to-Japan route, according to the Baltic Exchange. That is a 2.8 per cent gain for the week. Rates have dropped 42 per cent this month.
The near-term outlook is "continued softness", Jonathan B Chappell, an analyst with JPMorgan Chase in New York, said in a report. "With a nearly six-week transit time from the Arabian Gulf to the US, domestic refiners are not rushing to book new cargoes."
The US is the world's biggest energy consumer.
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 dollars a tonne, are revised annually by the Worldscale Association in London to reflect changing fuel costs, port tariffs and exchange rates. Each flat rate assessment gives owners and oil firms a starting point for negotiating hire rates without having to calculate the value of each deal from scratch.
Arrival of crude in the US "would be timed poorly with the onset of spring and heightened maintenance downtime", Chappell wrote. "This seasonal weakening is typical of this time of year, with tanker rates usually undergoing a period of softening until at least late April before summer driving- season demand begins to ramp up."
Shipowners' daily income from the voyage between the Gulf and Japan jumped 26 per cent to $28,463 (Dh104,544). Frontline, the world's biggest supertanker operator, needs $32,900 a day to break even on each of its VLCCs.
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