The cost of transporting Middle East crude oil to Asia, the world's busiest market for supertankers, may rise as refineries start booking vessels to load in September and weather conditions threaten to delay shipping.
Middle East oil-producing nations including Saudi Arabia, Iran and the United Arab Emirates (UAE) will tell refineries this week when they must have tankers in place to load at the region's ports for September, London-based shipbroker Galbraith's Ltd said in an Aug 17 report.
'This is the low point of the market and there is a chance for slightly higher levels,' Galbraith's said. Owners of modern, two-hulled tankers are 'likely to push for higher levels' as demand accelerates.
Storms such as those lashing Asia and the Caribbean normally delay tankers, reducing ship availability. Hurricane Dean struck the southern coast of Jamaica yesterday with winds of almost 241 kmh. Typhoon Sepat, which landed in China after hitting Taiwan on Sunday, caused shipping services to be cancelled, Taiwan's Fire Agency said.
Showa Shell Sekiyu KK, the Japanese refining unit of Royal Dutch Shell plc, hired the tanker Formosapetro Challenger at a rate of up to 56 Worldscale points, according to a report from Athens-based Optima Shipbrokers yesterday. That was 11 per cent higher than the London- based Baltic Exchange's benchmark rate of 50.28 points for a similar voyage.
Worldscale points are a percentage of a nominal rate, or flat rate, for more than 320,000 specific routes. Flat rates, quoted in US dollars a ton, are revised annually by the Worldscale Association in London to reflect changing fuel costs, port tariffs and exchange rates.
At 50.28 Worldscale points, owners of double- hulled very large crude carriers (VLCCs) can earn about US$19,107 a day on a 38-day round trip from Saudi Arabia to South Korea, based on a formula by RS Platou, an Oslo-based shipbroker, and Bloomberg bunker prices. Frontline Ltd, the world's biggest VLCC operator, said on May 30 it needs US$29,500 a day to break even on each of its supertankers.
Bookings for supertankers sailing from the Middle East to Asia account for 47 per cent of global demand for the carriers, according to New York-based McQuilling Brokerage Partners LLP.
Shipments to the US and the Caribbean, the second- biggest market, account for 14 per cent of demand for supertankers.
Middle East oil-producing nations including Saudi Arabia, Iran and the United Arab Emirates (UAE) will tell refineries this week when they must have tankers in place to load at the region's ports for September, London-based shipbroker Galbraith's Ltd said in an Aug 17 report.
'This is the low point of the market and there is a chance for slightly higher levels,' Galbraith's said. Owners of modern, two-hulled tankers are 'likely to push for higher levels' as demand accelerates.
Storms such as those lashing Asia and the Caribbean normally delay tankers, reducing ship availability. Hurricane Dean struck the southern coast of Jamaica yesterday with winds of almost 241 kmh. Typhoon Sepat, which landed in China after hitting Taiwan on Sunday, caused shipping services to be cancelled, Taiwan's Fire Agency said.
Showa Shell Sekiyu KK, the Japanese refining unit of Royal Dutch Shell plc, hired the tanker Formosapetro Challenger at a rate of up to 56 Worldscale points, according to a report from Athens-based Optima Shipbrokers yesterday. That was 11 per cent higher than the London- based Baltic Exchange's benchmark rate of 50.28 points for a similar voyage.
Worldscale points are a percentage of a nominal rate, or flat rate, for more than 320,000 specific routes. Flat rates, quoted in US dollars a ton, are revised annually by the Worldscale Association in London to reflect changing fuel costs, port tariffs and exchange rates.
At 50.28 Worldscale points, owners of double- hulled very large crude carriers (VLCCs) can earn about US$19,107 a day on a 38-day round trip from Saudi Arabia to South Korea, based on a formula by RS Platou, an Oslo-based shipbroker, and Bloomberg bunker prices. Frontline Ltd, the world's biggest VLCC operator, said on May 30 it needs US$29,500 a day to break even on each of its supertankers.
Bookings for supertankers sailing from the Middle East to Asia account for 47 per cent of global demand for the carriers, according to New York-based McQuilling Brokerage Partners LLP.
Shipments to the US and the Caribbean, the second- biggest market, account for 14 per cent of demand for supertankers.