Feb. 9 (Bloomberg) -- Charter rates for the biggest tankers hauling Middle East oil to Asia rose, rebounding from 11 declines in a row, as stronger demand reduced the surplus of available vessels.
Hire costs for very large crude carriers on the benchmark Saudi Arabia-to-Japan voyage gained 0.8 percent to 49.06 industry-standard Worldscale points today, according to the London-based Baltic Exchange. Rates plunged 25 percent during the losing streak.
The number of ships available to load cargoes in the Persian Gulf over the next four weeks shrank by seven, according to Kevin Sy, a Singapore-based freight-derivatives broker at Marex Spectron Group. Still, demand for oil in March is unlikely to boost rates because about 70 tankers are available for next month’s first 10 days, he said in a report.
“Another busy day, so another draw in the four-week supply,” Sy wrote.
Daily income for VLCCs on the benchmark route gained 5.9 percent to $7,347, according to the exchange. That reduced the drop since the start of the year to 40 percent. Each of the ships can hold 2 million barrels of crude.
The exchange’s assessments don’t reflect speed cuts aimed at reducing fuel costs, vessel owners’ main expense. Owners can curb those expenses, boosting returns, by slowing ships on return journeys after unloading of cargoes.
The price of ship fuel, or bunkers, advanced for a fifth session to $711.25 a metric ton, data compiled by Bloomberg from 25 ports worldwide showed.
Worldscale points are a percentage of a nominal rate, or flat rate, for more than 320,000 specific routes. Flat rates for every voyage, quoted in U.S. dollars a ton, are revised annually by the Worldscale Association in London to reflect changing fuel costs, port tariffs and exchange rates.
The Baltic Dirty Tanker Index, a broader measure of oil-shipping costs that includes vessels smaller than VLCCs, increased 1.4 percent to 795.
To contact the reporter on this story: Rob Sheridan in London at email@example.com
To contact the editor responsible for this story: Alaric Nightingale at firstname.lastname@example.org