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Monday, July 13, 2020

Maritime Logistics Professional

December 20, 2019

U.S.-Europe Tanker Rates at Record Highs

AdobeStock / © Jose Gill

AdobeStock / © Jose Gill

Rates for Aframax-class crude oil tankers leaving the U.S. Gulf Coast hit a record this week, according to three shipbrokers, reflecting strong demand in Europe and the Mediterranean for low-sulfur crude.

Equinor ASA and Unipec, the trading arm of China's top refiner Sinopec, provisionally chartered Aframax tankers Everest Spirit and Nordorchid, respectively, this week at rates of 245 worldscale points, according to one broker and Refinitiv Eikon data. Both vessels are headed to Europe.

The worldscale rate translates to about $60,700-per-day, well above the $46,800-per-day rate a week ago for Aframax vessels, according to calculations by shipbroker and consultants Poten & Partners. Aframax vessels can carry up to 700,000 barrels of oil.

Equinor and Unipec did not immediately respond to requests for comment.

Rates from the U.S. Gulf Coast to Europe have climbed in recent weeks as European demand for light, sweet U.S. crude has increased ahead of new maritime rules capping the sulfur content of fuel used by ocean-going vessels.

U.S. crude exports could touch 4 million barrels per day (bpd) for the first time in coming months, traders, analysts and shipbrokers said, as U.S. production nears a record 13 million bpd.

The number of Aframax tankers available to load U.S. crude has been in short supply since late September, when rates for supertankers surged on U.S. sanctions against vessels carrying Iranian oil, shipbrokers said.

Weather-related loading delays at ports along the U.S. Gulf Coast and a rush to offload crude oil ahead of year-end inventory taxes also strengthened rates, they said.

Oil producer Occidental Petroleum Corp, traders Mitsui & Co, Mercuria Energy Group, and Clearlake Shipping, a subsidiary of trader Gunvor Group, tentatively booked Aframax-class tankers for late December loadings at rates that ranged from 190 to 240 world scale from the U.S. Gulf Coast to the Mediterranean, according one of the shipbrokers and to Refinitiv Eikon data.

Occidental, Mitsui, Clearlake and Mercuria did not immediately respond to requests for comment.

Reporting by Collin Eaton

Crude oilcrude oil tankersEquinor ASA