Saturday, March 14, 2009

Caribbean Tanker Rates Rise 12% This Week on Stronger Demand .

By Todd Zeranski
March 13 (Bloomberg) -- The cost to transport crude oil from the Caribbean on Aframax tankers rose 12 percent this week as demand outweighed the number of ships available for voyages.
“Aframax rates continued to rally in the Caribbean,” E.A. Gibson Shipbrokers, based in London, said in a note. “In the short terms, rates are likely to be repeated but owners will struggle to maintain this level during next week.”
Aframaxes today were hired for an average rate of Worldscale 140, according to New York-based Poten & Partners, London-based Galbraith’s and Houston-based Lone Star, R.S. Platou, a decline of 1.8 percent from yesterday. WS 140 is about $36,978 a day after expenses, such as fuel and port fees.
Rates have more than doubled in March after ships moved out of the region at the end of February in search of higher rates in Europe, driving down supply.
“The thinning of tonnage allowed the firming of rates to continue this week,” Galbraith’s said in a note. “Inquiry levels will need to be maintained to keep these rates from softening.”
Royal Dutch Shell PLC contracted a ship to transit between the east coast of Mexico and the U.S. Gulf Coast, Lone Star said. Sunoco Inc. contracted an Aframax to move between Jose Terminal, Venezuela, and Philadelphia, and Lyondell Chemical Co. hired a ship to ferry oil from the Caribbean to the U.S. Gulf Coast, the broker said.
General Maritime Corp.’s Genmar Alexandra is scheduled for Covenas, Colombia, today, according to Bloomberg data. BP Plc’s British Merlin is due to arrive in Jose Terminal, Venezuela, on March 15, the data showed.
Five LOOP Arrivals
Five ships are due at the Louisiana Offshore Oil Port, or LOOP, the biggest U.S. oil-import terminal, the data showed.
Arrivals include Anangel Shipping Enterprises SA’s Astro Corona, Hebei Ocean Shipping Co.’s Hebei Mountain and Dr. Peters GmbH & Co.’s Front Chief. All are Suezmax-class ships that can carry 1 million barrels of oil.
Aframaxes due to arrive are Konig & Cie GmbH & Co.’s SKS Senne and Delta Tankers Ltd.’s Meltemi.
More than 40 percent of U.S. crude imports come from nearby countries, including Canada, Mexico and Venezuela, according to E.A. Gibson Shipbrokers. The U.S. consumes about one-quarter of the world’s crude.
General Maritime Corp., the second-largest U.S.-based tanker owner, estimated its 2009 daily operating expenses for an Aframax at $8,150.
Worldscale points are a percentage of a nominal rate, or flat rate, for tanker shipments on various routes. Flat rates, quoted in U.S. dollars a ton, are revised annually by the Worldscale Association in London to reflect changing costs.
The Caribbean is the world’s third-largest Aframax-tanker market, after the Mediterranean and Southeast Asia. An Aframax is the most common tanker used to move oil in the region. It can carry 600,000 barrels of oil.
To contact the reporter on this story: Todd Zeranski in New York at Last Updated: March 13, 2009 14:49 EDT

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