The rates for hiring medium to long-range tankers on Asian routes to transport oil products including diesel may decline after falling on maintenance plans by petrochemical companies.
The rate of shipping a 55,000 tonne cargo to Japan from the Middle East dropped to its lowest in more than a month, losing 0.7 per cent to Worldscale 186.73 yesterday, according to the London-based Baltic Exchange. That translates to US$32.61 a tonne, according to Bloomberg data.
'Maintenance on petrochemical plants in Asia is expected to trim naphtha demand in the near term,' London-based SSY Consultancy & Research says in its weekly report. 'Arbitrage opportunities for clean products were generally limited from most regions and with trade fairly slow, this meant there was only minor movement in rates.'
Formosa Petrochemical Corp, Taiwan's only publicly traded oil refiner, plans to shut one of its three ethylene plants for maintenance in September. The plant, capable of making 1.03 million tonne of ethylene a year from naphtha, is scheduled for an overhaul that will last between 40 days and 45 days starting Sept 3. Naphtha, distilled from crude oil, is a raw material for chemicals, plastics and petrol.
Japan 'indicated that it would lower its naphtha imports due to increased refinery runs and a planned decline in ethylene production', Vienna-based PVM Oil Associates GmbH says in its Aug 13 report.
More vessels are becoming available for hire, especially in North Asia, pushing rates lower, according to shipbrokers including London-based EA Gibson Shipbrokers Ltd. There were 13 medium to long-range tankers scheduled to arrive last week in Singapore, with another seven slated this week, according to Bloomberg data. The vessels are able to carry as much as 1.02 million tonnes of cargo.
The rate for moving 30,000 tonnes of oil products to Japan from Singapore fell 0.4 per cent to Worldscale 222.5 on Tuesday, according to the Baltic Exchange. The rate translates to US$19.59 for a tonne of product, according to Bloomberg data.
The cost of shipping 75,000 tonnes of products to Japan from the Persian Gulf was at Worldscale 154.58 on Tuesday, up 0.4 per cent from a day earlier, the Baltic Exchange data showed.
A long-range 1 tanker, also known as LR1, can carry 50,000 tonnes to 80,000 tonnes of oil products and is able to pass through the Panama Canal. A long-range 2 tanker, or LR2, can transport 80,000 tonnes to 160,000 tonnes of products while a medium- range tanker can carry 25,000 tonnes to 45,000 tonnes of fuel.
Worldscale points are a percentage of a nominal rate, or flat rate, for a specific route. Flat rates, quoted in US dollars a tonne, are revised annually by the Worldscale Association in London to reflect changing fuel costs, port tariffs and exchange rates.
The rate of shipping a 55,000 tonne cargo to Japan from the Middle East dropped to its lowest in more than a month, losing 0.7 per cent to Worldscale 186.73 yesterday, according to the London-based Baltic Exchange. That translates to US$32.61 a tonne, according to Bloomberg data.
'Maintenance on petrochemical plants in Asia is expected to trim naphtha demand in the near term,' London-based SSY Consultancy & Research says in its weekly report. 'Arbitrage opportunities for clean products were generally limited from most regions and with trade fairly slow, this meant there was only minor movement in rates.'
Formosa Petrochemical Corp, Taiwan's only publicly traded oil refiner, plans to shut one of its three ethylene plants for maintenance in September. The plant, capable of making 1.03 million tonne of ethylene a year from naphtha, is scheduled for an overhaul that will last between 40 days and 45 days starting Sept 3. Naphtha, distilled from crude oil, is a raw material for chemicals, plastics and petrol.
Japan 'indicated that it would lower its naphtha imports due to increased refinery runs and a planned decline in ethylene production', Vienna-based PVM Oil Associates GmbH says in its Aug 13 report.
More vessels are becoming available for hire, especially in North Asia, pushing rates lower, according to shipbrokers including London-based EA Gibson Shipbrokers Ltd. There were 13 medium to long-range tankers scheduled to arrive last week in Singapore, with another seven slated this week, according to Bloomberg data. The vessels are able to carry as much as 1.02 million tonnes of cargo.
The rate for moving 30,000 tonnes of oil products to Japan from Singapore fell 0.4 per cent to Worldscale 222.5 on Tuesday, according to the Baltic Exchange. The rate translates to US$19.59 for a tonne of product, according to Bloomberg data.
The cost of shipping 75,000 tonnes of products to Japan from the Persian Gulf was at Worldscale 154.58 on Tuesday, up 0.4 per cent from a day earlier, the Baltic Exchange data showed.
A long-range 1 tanker, also known as LR1, can carry 50,000 tonnes to 80,000 tonnes of oil products and is able to pass through the Panama Canal. A long-range 2 tanker, or LR2, can transport 80,000 tonnes to 160,000 tonnes of products while a medium- range tanker can carry 25,000 tonnes to 45,000 tonnes of fuel.
Worldscale points are a percentage of a nominal rate, or flat rate, for a specific route. Flat rates, quoted in US dollars a tonne, are revised annually by the Worldscale Association in London to reflect changing fuel costs, port tariffs and exchange rates.