Feb. 21 (Bloomberg) -- A surplus of the largest oil tankers competing to load crude at Persian Gulf ports shrank to this month’s lowest level, a survey showed.
There are 9 percent more very large crude carriers available for hire over the next 30 days than there are likely cargoes, according to a Bloomberg survey of six shipbrokers and owners today. That was the smallest excess since Jan. 31.
The VLCC surplus reached a 14-month low of 5 percent on Jan. 17, helped by stronger crude demand before China’s New Year. The ships are earning $16,275 daily on the benchmark Saudi Arabia-to-Japan voyage, up 33 percent since the start of the year, according to the London-based Baltic Exchange.
“March cargoes are behind schedule, so activity is expected to pick up this week,” Oslo-based investment bank RS Platou Markets AS said in an e-mailed report today.
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 cargoes.
The price of ship fuel, or bunkers, increased for a fourth session to $721.77 a metric ton, data compiled by Bloomberg from 25 ports worldwide showed. That was the highest level since at least October 2008, according to the figures.
Charter rates for VLCCs, each able to haul 2 million barrels of crude, on the benchmark route slid 0.4 percent today to 54.41 industry-standard Worldscale points.
The 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, declined 0.4 percent to 814.
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