Aug. 21 (Bloomberg) -- Shipping rates may gain support as more single-hulled supertankers head to scrap yards, as owners of these vessels see demolition as the best option in a weak market, E.A. Gibson Shipbrokers Ltd. said in a report today.

Three so-called Very Large Crude Carriers, which can carry two million barrels of oil, have been sent for demolition so far this year, matching the total for all of 2008, when shipping rates were higher, the broker said.

Two VLCCs sold for scrap this month “is perhaps an indication that more owners may be considering cutting their losses as more charterers turn their back on the singles,” Gibson said in the report.

Increased scrapping of single-hulled supertankers could support shipping rates by mitigating the projected increase in the size of the world fleet. London-based Drewry Shipping Consultants Ltd. estimates 225 vessels, including 37 supertankers, are due to enter the fleet this year, raising capacity by 7.8 percent. Gibsons said 98 single-hull tankers are on the water now, with about one-quarter 20 years or older.

Crude-oil shipping rates have fallen 41 percent this year as global energy demand was cut by recession, and the Organization of Petroleum Exporting Countries cut production quotas 16 percent to 24.85 million barrels a day since September 2008.

“Any significant increase in tanker scrapping could put the brakes on asset values from dropping still further and may have a positive effect on market rates,” Gibsons said.

Benchmark Rate

Rates for the benchmark Saudi Arabia-Japan supertanker route have fallen 42 percent in the past year. Income after fuel costs from the voyage dropped 14 percent to $11,660 a day today, according to the Baltic Exchange, which is less than owners need from the vessels to pay crew, insurance, repairs and other running costs.

Owners of single-hull vessels also aren’t receiving much inquiry to store oil at sea, perhaps prompting additional scrapping, the shipbroker said. Traders this year sought to profit from a contango in oil markets, when prompt-delivery contracts are cheaper than those for later delivery,

Single hulls are due to be phased out as of next year, after more than 150 countries decided that two layers of steel are better than one for preventing oil spills.

To contact the reporter on this story: Todd Zeranski in New York at tzeranski@bloomberg.net

Last Updated: August 21, 2009 16:06 EDT